- Growth in the non-consumer division
- Shares up 11% over the past year
- Cash generation helped pay down debt
Shares in Bloomsbury (BMY) gained over 6% to 615p in morning trading as the publishing outfit reported full year trading ahead of consensus expectations following a strong second half.
Consensus market expectations for the year ending 28 February are for revenue of £333.4 million and pre-tax profit of £39.6 million.
The publishing group attributed the robust performance to the acquisition of US academic publisher Rowman & Littlefield for £65 million last May which added 40,000 academic titles to its portfolio.
The company said the integration of Rowman & Littlefield was progressing very well and driving growth in the non-consumer division.
BDR (Bloomsbury Digital Resources) also saw growth for the full year despite budgetary pressures.
The company said strong cashflow for the full year period has enabled it pay down $7.5 million of the $37 million debt associated with the acquisition ahead of schedule.
Bloomsbury was founded in 1986 by the current chief executive Nigel Newton and three others. Its initial success can be traced to the decision to sign then unknown author J.K. Rowling and the subsequent publication of the hugely successful Harry Potter series. When the initial phase of Pottermania eased, Bloomsbury’s fortunes waned with it.
The company said it will provide further details on trading and outlook in its preliminary results announcement on 22 May.
A COVID WINNER
Russ Mould, investment director at AJ Bell said: ‘Bloomsbury is a rare example of a Covid winner which has kept on winning since we emerged from the pandemic, with its latest trading update a compelling read for shareholders.
‘During lockdown people rediscovered a love of learning which directly benefited the publishing outfit, but it has not rested on its laurels. A combination of expansion into academic markets and identifying and snapping up new literary talent has allowed the business to consistently outpace expectations.
‘Today’s statement and the latest upgrade to guidance are an indication of how well the business is performing.
‘25 years ago, Bloomsbury was heavily reliant on the Harry Potter series. It now has a much more diversified portfolio. One lingering concern for investors might be the impact of the Trump administration’s policies on the academic publishing market.’
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DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.
