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Bloomsbury Publishing delighted with digital growth in tough times for booksellers

Snapshot

  • Book publisher
  • Titles include Harry Potter series
  • Operates consumer and non-consumer divisions
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Quick facts: Bloomsbury Publishing PLC

Price: - -

LSE:BMY
Market: LSE
Market Cap: -
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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

 

How it is doing

In the four months to June 30, year-on-year sales jumped 18% to £49.5mln, boosted by a 28% rise in consumer revenues to £31.5mln.

Print revenues rose 9% year-on-year, while digital sales surged 63% thanks to a 53% jump in sales of e-books during the peak period of lockdown measures.

Meanwhile, the company’s non-consumer division, which includes academic and professional publishing, was up 3% in the year to £18mln.

The outlook remains uncertain amid the pandemic but revenues and earnings are weighted towards the second half, with sales of trade titles rising for Christmas and sales of academic titles being strongest at the start of the academic year in the Autumn.

 

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What the broker says

In July, analysts at Peel Hunt retained their ‘add’ rating and 265p price target on the firm, saying Bloomsbury’s “diversity of territory, subject matter and sales channel” had protected it against the effects of the pandemic.

“There is an element of the law of the small number. Normally these would be modest months for Bloomsbury sales, so the positive impact of demand patterns during lockdown is perhaps disproportionate. Nonetheless, +18% is a welcome start to the year”, the broker said.

“The resilience of books as a product set in a recession, a low ticket item with sturdy consumption patterns, is clear. Add to this the value of diversity at Bloomsbury (of end markets, regions, sales channels and product types), and today’s news should prompt the market to revisit the stock for its defensive characteristics and resilience in an uncertain world.”

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