Bloomsbury Shares Extend Gains Despite Weak Market Sentiment

3 min read | June 03, 2021 06:59 PM AEST | By Suhita Poddar

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Bloomsbury Shares Extend Gains Despite Weak Market Sentiment — Image source: ST House Studio, Shutterstock.com

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Summary

Publisher Bloomsbury Publishing announced record profits due to a rise in people reading amid the lockdowns.

The company also proposed a special dividend of 9.78 pence per share, in addition to a 10 per cent increase to its final dividend.

Harry Potter book publisher Bloomsbury Publishing PLC’s (LON:BMY) shares that had surged over 12 per cent on Wednesday after it announced record profits in FY2021 have extended their gains on Thursday, even though the broader markets were in sombre mood. The publishing company reported that its FY 2021 profit before tax increased by 22 per cent to £19.2 million, compared to £15.7 million in FY 2020.

FY 2021 Earnings

Bloomsbury reported its revenues surged by 14 per cent to £185.1 million from £162.8 million in the previous year. Comparatively, the publishing industry market rose by 2 per cent the same year. The company attributed the rise in sales due to people reading more books during the pandemic induced lockdowns.

The company also proposed a special dividend of 9.78 pence per share, in addition to a 10 per cent increase to its final dividend to 7.58 pence per share.

Also Read: Performance Review of Two Media Stocks Trending on LSE: Bloomsbury Publishing & STV Group

Market cheers results

Bloomsbury Publishing’s shares were up by 1.45 per cent at GBX 349.00 on 3 June at 09:28 HRS GMT+1. Meanwhile, the FTSE All Share index which the company is a part of, was trading at 4,038.86, down by 0.61 per cent.

(Image Source: EODHD/Others)

Also, the company’s market cap stood at £ 280.73 million and its year to date returns were at 20.64 per cent. BMY’s price to earnings ratio in FY 2020 stood at 17.46.

Recent Acquisitions

BMY had also announced the completion of its acquisition of academic print company Red Globe Press from global publisher Macmillan Education Limited in a £3.7 million transaction on 1 June. The company paid up to £1.8 million in cash. The remaining amount of £1.9 million will be paid after the completion of the deal and is subject to certain contracts.

It also announced the acquisition of issued share capital of independent publisher, Head of Zeus Limited. The deal’s total valuation is worth £8.45 million, and it also includes the payments of pre-existing loans, and worth £7.35 million net of pre-existing loans.

Also Read: How Is Shift Towards Digital Platform Affecting Bloomsbury Publishing PLC (BMY)?

The deal will include a £5.5 million cash transaction at completion, and an amount of £1.1 million will be payable in cash post the completion of the deal and subject to considerations.

The Head of Zeus Limited deal will be a part of BMY’s consumer division and aims to support the company’s long-term growth strategy.

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