REG - BloomsburyPublishing - Annual Financial Report
14/06/2024 17:15
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RNS Number : 5748S Bloomsbury Publishing PLC 14 June 2024
14 June 2023
Annual Financial Report
Bloomsbury Publishing Plc (the "Company")
The Company released its Preliminary Announcement of annual results for the
year ended 29 February 2024 on 23 May 2024. Further to the Preliminary
Announcement, the Company can confirm that the Annual Report and Accounts for
the year ended 29 February 2024 ("2024 Annual Report") and the Notice of
Annual General Meeting ("Notice of AGM") have been posted, or otherwise made
available, to Shareholders.
The 2024 Annual Report and the Notice of AGM may also be viewed on the
Company's website at www.bloomsbury-ir.co.uk (http://www.bloomsbury-ir.co.uk)
.
AGM
The Company's Annual General Meeting ("AGM") will be held on Tuesday 16 July
2024 at 12.00 noon at the Charlotte Street Hotel, 15-17 Charlotte Street,
London W1T 1RJ.
National Storage Mechanism
Pursuant to Listing Rule 9.6.1R, electronic copies of the 2024 Annual Report
and the Notice of AGM have been submitted to the National Storage Mechanism
and will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
Additional Information
In accordance with Disclosure Guidance and Transparency Rule 6.3.5R,
additional information is set out in the appendices to this announcement.
The Directors' Responsibility Statement, a description of the Principal Risks
and Uncertainties and details of Related Party Transactions are set out below
in full unedited text extracted from the 2024 Annual Report. The text below
should be read in conjunction with the Company's final results for the period
ended 29 February 2024 which were announced on 23 May 2024. This information
is not a substitute for reading the 2024 Annual Report.
For further information, please contact:
Bloomsbury Publishing Plc
Maya Abu-Deeb, Group General Counsel & Company Secretary maya.abu-deeb@bloomsbury.com
Hudson Sandler +44 (0) 20 7796 4133
Dan de Belder / Hattie Dreyfus / Emily Brooker bloomsbury@hudsonsandler.com
APPENDIX 1: Directors' Responsibilities Statement
The following directors' responsibility statement is extracted from the 2024
Annual Report (page 105):
Statement of Directors' responsibilities
The Directors are responsible for preparing the Annual Report and the Group
and Parent Company financial statements in accordance with applicable law and
regulations.
Company law requires the Directors to prepare Group and Parent Company
financial statements for each financial year. Under that law, they are
required to prepare the Group financial statements in accordance with
UK-adopted international accounting standards and applicable law and have
elected to prepare the Parent Company financial statements on the same basis.
Under Company Law, the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of
affairs of the Group and Parent Company and of the Group's profit or loss for
that period. In preparing each of the Group and Parent Company financial
statements, the Directors are required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable, relevant,
reliable and prudent;
• state whether they have been prepared in accordance with
international accounting standards in conformity with the requirements of the
Companies Act 2006;
• assess the Group and Parent Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern;
and
• use the going concern basis of accounting unless they either
intend to liquidate the Group or the parent Company or to cease operations, or
have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that its financial statements comply with the Companies
Act 2006. They are responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error, and have general
responsibility for taking such steps as are reasonably open to them to
safeguard the assets of the Group and to prevent and detect fraud and other
irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, Directors' Report, Directors' Remuneration
Report and Corporate Governance Statement that complies with that law and
those regulations.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the UK governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
In accordance with Disclosure Guidance and Transparency Rule 4.1.15R, the
financial statements will form part of the annual financial report prepared
using the single electronic reporting format under the TD ESEF Regulation. The
Auditor's report on these financial statements provides no assurance over the
ESEF format.
Safe harbour
Under the Companies Act 2006, a safe harbour limits the liability of Directors
in respect of statements in and omissions from the Strategic Report and the
Directors' Report. Pages 01 to 213 of the Annual Report, and the front and
back covers to the Annual Report, are included within the Directors' Report by
reference and so are included within the safe harbour.
Responsibility statement of the Directors in respect of the annual financial
report
Each of the Directors, whose names and functions are set out on pages 96 and
97 of this Annual Report, confirms that to the best of their knowledge:
• the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company and
the undertakings included in the consolidation taken as a whole; and
• the Strategic Report/Directors' Report includes a fair review of
the development and performance of the business and the position of the issuer
and the undertakings included in the consolidation taken as a whole, together
with a description of the principal risks and uncertainties that they face.
We consider the Annual Report and Accounts, taken as a whole, is fair,
balanced and understandable and provides the information necessary for
Shareholders to assess the Group's position and performance, business model
and strategy.
Legislation in the UK governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
The Strategic Report and Directors' Report were approved by the Board on 22
May 2024.
APPENDIX 2: Principal Risks and Uncertainties
The following description of the principal risks and uncertainties that the
Company faces is extracted from the 2024 Annual Report (pages 84 to 91):
Key: ↑Increase, ↔No change, ↓ Reduced
Principal Risks
Key area Description Mitigation
Market Market volatility: impact of economic instability • Bloomsbury combines academic and general publishing in different formats
and distributes its products through different channels. In addition, we
operate in multiple countries and sell our products worldwide. This
diversified portfolio and customer base, together with our international
Changes during the year Economic instability, inflationary pressures and, in the case of academic presence creates a level of resilience in respect of market or
institutions, funding/budgetary pressures may lead to changes in demand for country-specific downturns
↑ products, impacting revenues and margins.
• Close monitoring of revenue streams, lists and channels; range and
diversity of our content; resilience of demand for strong content
• Close monitoring of developments in the academic market including library
spending and demand for HSS course material, adjusting publishing and
marketing programmes accordingly
• Continue focus on promoting Academic BDR products, developing BDR product
pipeline and adopting flexible buying solutions to enable customers to
purchase according to their individual content requirements and budgetary
constraints
• Focus on expanding international sales in territories where student
numbers and investment in Higher Education are increasing
• Increase marketing and sales activities focused on retaining reader
engagement
• Continue focused promotion of reading for pleasure including at key travel
points
Increased dependence on internet retailing • Grow expert marketing teams skilled in internet sales.
• Engage with multiple internet retailers and support independent
retailers.
Growth of online retailers may impact on the discoverability of Bloomsbury
titles and lead to a reduction in sales channels available to the Group. • Focus on promoting sales from the Company's own website and on direct
sales to customers
• Increase focus on developing other marketing opportunities and other
revenue streams, e.g. academic and professional digital products, rights and
services
Open access • Develop digital services that deliver mixed Open Access and proprietary
content in the form that customers demand and will continue to pay for.
Policy changes in the UK, Europe and US are accelerating the requirement for
publicly funded scholarly content to be published on an Open Access basis. • Director of Research and Open Access manages responses to developments in
From 1 January 2024, UK Research and Innovation (UKRI) UKRI will require Open Access publishing and related mandates to ensure the successful
monographs, book chapters and edited collections that acknowledge UKRI funding transition to sustainable Open Access business models. Business workflow and
to be made Open Access within 12 months of publication. If there is not systems are in the process of being adapted to ensure capacity to operate at
sufficient public funding in place, then income from UK-originated monographs scale
that are submitted to the REF - the UK's system for assessing the quality of
research in UK higher education institutions - may be impacted. • Open Access publishing initiatives are underway to ensure Bloomsbury is
well placed to continue to serve its UK academic authors, and in preparation
for the adoption of UKRI's proposed policy in respect of monographs from 2024.
In March 2024, the UK's Research Excellence Framework (REF) launched a • Continue to engage with industry representative bodies to influence Open
consultation on requiring all scholarly books and chapters submitted to it to Access policy developments, including in respect of the response to the UK's
be made Open Access within two years of publication. If implemented, this will Research Excellence Framework (REF) consultation
effectively be a mandate for all UK-authored scholarly books to be made Open
Access. This is at the consultation stage and the final policy is expected to
be announced in late 2024.
In the US, federal agencies, including the National Endowment for the
Humanities (NEH) and National Endowment for the Arts (NEA) are consulting on
introducing Open Access requirements by 2026, while, in Europe, the PALOMERA
project aims to align European research funders over the next two years to
accelerate Open Access for books and chapters.
Sales of used books • Digital subscriptions and multiple ebook purchasing models are offered
direct to institutions and students
Sales of used books for academic purposes erode backlist sales.
Rental of textbooks • Develop digital resources and ebook platforms to deliver, direct to
institutions and students, the content and flexible pricing models to suit
US readers may license books from retailers for a limited period at a lower readers' requirements
cost to buying books, with no revenues or royalty paid to the publisher.
Importance BDR revenues and profit • Develop a portfolio of high-quality online content services in markets
we understand well
of digital Revenue and profit from BDR products and services may not grow in line with
our stretching targets. • Use third party content and content partnerships to scale up projects
publishing
more quickly and create economies of scale.
• Continue to invest in internal resource and infrastructure to support
See also Market Risk product pipeline
Changes during the year
↑
Acquisitions M&A activity • Potential acquisition targets are assessed by the members of the
Executive Committee according to strategic and cultural fit. Thorough
Acquisitions could deliver lower than expected return on investment. Poor pre-acquisition due diligence is conducted by relevant functions, including
acquisitions may result in potential impairment charges. finance, legal, publishing and sales. Capital allocation for acquisitions is
Changes during the year determined at Group level and approved by the Board. Integration plans are
developed at Divisional level and are implemented by a cross-functional team
↔ of experts, with Divisional oversight
• Regular reports are presented to the Board throughout the year on
post-acquisition performance, including an assessment of any variation to the
expected return on investment
Title acquisition Commercial viability • Advances over a certain limit are required to be authorised by the Chief
Executive and Group Finance Director
(Consumer Titles may be acquired that are not commercially or critically successful.
• Financial forecasts are prepared prior to acquisition to predict
publishing) commercial success
• Focus on acquiring world rights where possible in order to increase
sales opportunities and mitigate the risk posed by competing editions in open
Changes during the year markets
↔ • Editorial guidelines and policies in place to guide acquisition
decisions
Information Cybersecurity/malware attack • Audit Committee monitoring of scope,
and technology Unauthorised access to the Company's systems may result in fraud, a data development and performance of cyber
privacy breach, theft of intellectual property, inability to access, or damage
systems to, vital systems and assets, thus causing financial and reputational damage security controls
to the Group.
• Follow industry best practice for information and cyber security, with
active management of information and cyber security risks.
Changes during the year
• Controls include Advanced Endpoint
↑
protection, including Next Generation
Antivirus, with events fed to a Centralised
Endpoint Protection Platform. This is supported by a 24x7 Managed Detection
and Response service, which performs proactive threat hunting of our
environment every 24 hours. Automation is in place to disable processes and/or
isolate endpoints for high and critical threats
• Manage access to Company assets and
services on a least-privilege basis, with Multi-Factor Authentication required
for remote access and when accessing business-critical cloud services
• Perform frequent vulnerability scans of the Company's internal and
external network to identify and remediate emerging threats
• Encrypted backups taken daily with copies stored off site and segmented
from the Company's network
• Information security policies are in place and staff training includes
data protection, cyber security and regular phishing simulations
Inadequate internal access controls or security measures • Sensitive personal data is stored securely and protected with password
controls or encryption. User access controls are embedded in the Company's
Inadequate controls over certain processes could lead to sensitive data being finance systems
inadvertently revealed internally or externally.
Systems Changes • Establish specific governance structures to manage significant projects
Ineffective change management may create operational challenges, affecting the • Ensure adequate resources are in place to address the requirements of
Group's ability to deliver strategic, commercial and operational objectives systems changes alongside day-to-day business
• Ensure clear and detailed planning of each and any system changes,
including the impact of other projects
Financial Judgemental valuation of assets and provisions • Consistent and evidence-based approach to assumptions
Valuations Significant assets and provisions in the balance sheet depend on judgemental • Board approval of key assumptions
assumptions, e.g. goodwill, advances, intangible rights, inventory and returns
provisions.
Changes during the year
↔
Intellectual Erosion of copyright • Continue policy of support for copyright and intellectual property
rights as a fundamental facet of publishing
Property Erosion of traditional copyrights.
Changes during the year
↑
Erosion of territorial copyrights as a result of global internet retailing. • Continue to police infringements of the Group's territorial copyrights
and take appropriate action to enforce such rights
Infringement of Group IP by third parties • Adopt robust anti-piracy procedures.
Failure to adequately manage and protect the Group's intellectual property • Undertake targeted enforcement action against third party infringers
rights (including trademarks and copyright) may damage the value of our core
assets and impact on profits. • Ensure appropriate digital rights management protection of ebooks and
digital formats
Reliance on key Failure of key counterparties or breakdown in key counterparty relationships • Relationships with key counterparties are closely monitored and actively
managed by senior managers. This includes frequent and regular engagement with
Counterparties; supply chain resilience The failure of key counterparties could result in a significant disruption to key counterparties in order to ensure open communication and cooperation and
the Group's business activities, resulting in lower levels of trading and to identify potential issues that may impact on the Company's business at the
revenues. earliest opportunity. Other mitigations include having appropriate contracts
and service level agreements in place, and interrogating the business
Changes during the year continuity plans of key counterparties
↑ The Group's ability to meet customer demand for print products depends on • Regular review of global supply chain resilience by the cross-function
timely supply from our printing partners. This may be impacted by the Supply Chain Working Group to ensure proactive steps are implemented to
availability of raw materials (e.g. paper pulp) and ongoing global supply mitigate supply chain risks and prioritise supply of print titles
chain disruption.
• Ongoing diversification of supplier base
• Increased local printing to mitigate shipping delays and disruptions
A breakdown in key commercial relationships could impact on future publishing
opportunities. • Apply additional due diligence in respect of key partners to assess
their financial stability, cyber and information security practices and
business continuity plans
• Continually assess key partner capabilities and performance to ensure
they are well- positioned to support the Group's long-term strategic
objectives
• Ensure effective leadership and change management governance structures
and resources are in place to oversee the transition of services provision
from one supplier to another
Talent Failure to attract and retain key talent and create an inclusive and • Ongoing focus at Board and senior leadership level on creating an
supportive environment in which the Group's employees can thrive engaging, inclusive and rewarding working environment
Management and retention
Inability to recruit individuals with the necessary skills and experience • Ongoing employee engagement measures to monitor and improve employee
could impact on Bloomsbury's ability to innovate and grow. experience and organisational culture; more information on these measures is
set out on pages 48 to 52 of this Annual Report
Changes during the year
• Continue focus on employee development through training and mentoring
↓ Loss of key talent could lead to loss of skill and knowledge from the programmes for early and mid-career employees
business, result in decreased efficiency, impact on staff motivation and
undermine external relationships. • Extensive learning and development initiatives exist, ranging from
individual skills training through to Leadership Development of our senior
managers
• Ongoing Employee Voice Programme, allowing every employee to have their
voice heard directly by senior management and the Board. HR initiatives are
implemented in response to matters raised during Employee Voice Meetings
• Formal appraisal system provides the opportunity to identify learning and
development opportunities to support career progression and succession
planning
• Continued focus on Diversity and Inclusion initiatives
• Implement pay and reward structures that incentivise and ensure that
colleagues share in the Group's success. Introduction of Bloomsbury Career
Framework has involved rigorous evaluation of all roles, with external
benchmarking of salaries in order to create a transparent and clear framework
of job families and career levels
Legal and Breach of key contracts by the Company • Relevant individuals within the business who are engaged in activities
which relate to or are governed by key contracts are made aware of the terms
Compliance Breach of a key contract by the Company could result in a claim for damages of such contracts. Legal advice is sought from the Group's legal function
and/or termination of the contract by the relevant counterparty, resulting in where appropriate to ensure performance by the Company in accordance with
financial loss to the Group. contractual terms
Changes during the year
↔
Failure to comply with applicable regulations • Annual Report and Accounts is reviewed internally by the Head of Group
Finance and the Group Finance Director, and externally by the Group's
Failure to comply with regulations relating to the reporting of annual appointed Auditor. Material balances are tested in accordance with relevant
financial reports may lead to a range of sanctions including fines, standards. The Head of Investor Relations and the Group Company Secretary
imprisonment, reputational damage, and delisting. advise on content requirements under relevant regulation/legislation.
Failure to comply with privacy regulations may result in significant fines and • Mitigation in respect of the risk of a data breach is noted above in
reputational damage connection with Information Technology and Systems
• Since the introduction of the General Data Protection Regulation
("GDPR"), which came into force in May 2018, the Company has implemented a
range of measures to ensure compliance with the requirements of GDPR. These
include the implementation of policies and guidance in key areas, the
provision of training to employees, reviewing and updating the Company's data
collection methods and marketing communications, updating supplier terms and
conditions, and updating privacy policies on the Company's websites. The
Company has appointed a Data Protection Officer to oversee GDPR compliance
Failure to comply with regulations relating to product safety certification, • Relevant business units are advised by the Group's in-house legal
accessibility and sustainability may affect access to our market department, with specialist external advice taken where required, on
forthcoming legislative and regulatory changes and appropriate measures taken
to respond to such changes, including adapting operational processes and
workflows where necessary.
Reputation Investor confidence • Diversify the portfolio of products and services to reduce dependencies
on individual customers, sales channels and markets
City confidence undermined by events outside of the Company's control, e.g.
collapse of a retailer.
Changes during the year
↔
Cost inflation Print Supply Costs • Long-term contracts with key suppliers to manage and mitigate cost
increases; active price management of Bloomsbury products to recover
Increased print supply costs resulting from increases to energy prices and raw incremental costs; diversification of supplier base
materials could impact on margin and achievement of the Group's financial
Changes during the year targets. • Staff costs are managed as part of the Group's budgeting process and
annual salary reviews
↓
Increased staff costs as a result of inflation.
APPENDIX 3: Related Party Transactions
The following details of 'Related party transactions' are shown in note 27 to
the Company Financial Statements on page 192 of the 2024 Annual Report.
27. Related party transactions
There are no related party transactions other than key management remuneration
as disclosed in note 5.
The following detail on staff costs is extracted from note 5 (page 169):
5. Staff costs
The Group considers key management personnel as defined under IAS 24 "Related
Party Disclosures" to be the Directors of the Company; this includes
Non-Executive Directors, and the heads of the global divisions, major
geographic regions and departments who are actively involved in strategic
decision-making that make up the Executive Committee (for membership see pages
98 to 99 for further details).
Total emoluments for Executive Directors and other key management personnel
were:
Year ended Year ended
29 February 28 February
2024 2023
£'000 £'000
Short-term employee benefits 6,311 4,387
Post-employment benefits 177 170
Share-based payment charge 1,342 1,020
Total 7,830 5,577
The following detail on related parties is extracted from note 48 (page 209):
48. Related parties
Trading transactions
During the year the Company entered into the following transactions and had
the following balances with its subsidiaries:
29 February 28 February
2024 2023
£'000 £'000
Sale of goods to subsidiaries 11,824 13,864
Management recharges 16,029 12,913
Commission receivable from subsidiaries 6 2
Commission payable to subsidiaries 325 273
Finance income from subsidiaries 95 84
Finance costs to subsidiaries 640 427
Amounts owed by subsidiaries at year end 10,707 13,445
Amounts owed to subsidiaries at year end 81,689 73,131
All amounts outstanding are unsecured and will be settled in cash. £0.5
million provision has been made for doubtful debts in respect of the amounts
owed by subsidiaries (2023: £0.5 million).
Key management remuneration is disclosed in note 5.
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