Annual Financial Report

RNS Number : 2517C
Bloomsbury Publishing PLC
24 June 2016
 

Annual Financial Report

Bloomsbury Publishing Plc ("Company")

Bloomsbury Publishing Plc confirms that the following documents have been sent to shareholders and, pursuant to Listing Rule 9.6.1, have been submitted to the National Storage Mechanism and will be available for inspection at http://www.hemscott.com/nsm.do:

·           Company's Annual Report and Accounts for the year ended 29 February 2016

·           Notice of the 2016 Annual General Meeting

·           Form of Proxy

The Annual Report and Accounts and Notice of the AGM can be found on the Company's website at www.bloomsbury-ir.co.uk .

In accordance with Disclosure and Transparency Rule 6.3.5, a 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 Annual Report and Accounts for the period ended 29 February 2016.  The text below should be read in conjunction with the Company's final results for the period ended 29 February 2016 which were announced in unedited full text on 19 May 2016.

 

Enquiries:

Michael Daykin
Group Company Secretary
Bloomsbury Publishing Plc
Telephone +44(0)20 7631 5627

 

DIRECTORS' RESPONSIBILITIES STATEMENT

(From page 47 to 48 of the Directors' Report of the Annual Report and Accounts for the year ended 29 February 2016)

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 IFRSs as adopted by the EU 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 their profit or loss for that period. In preparing each of the Group and parent Company financial statements, the Directors are required to:

a) select suitable accounting policies and then apply them consistently;

b) make judgements and estimates that are reasonable and prudent;

c) state whether they have been prepared in accordance with IFRSs as adopted by the EU; and

d) prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the parent Company will continue in business.

The directors are responsible for keeping adequate accounting

records that are sufficient to show and explain the parent Company's transactions and disclose with reasonable accuracy at any time the financial position of the parent Company and enable them to ensure that its financial statements comply with the Companies Act 2006. They 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, www.bloomsbury-ir.co.uk. Legislation in the

UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The Board confirms that, in the opinion of the Board, 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.

The Board confirms that to the best of its knowledge:

a) 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

b) the 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.

Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

 

PRINCIPAL RISKS AND UNCERTAINTIES

From pages 34 to 35 of the Risk Factors of the Company's Annual Report and Accounts for the year ended 29 February 2016)

The table below provides a description of risk factors that management considers relevant to the Group's business. Other factors besides those listed could also affect the Group.

During the financial year ended 29 February 2016 the principal risks have not changed substantially.

Key area

Risk

Description

Mitigation

Market

Volatility of consumer book sales

Sales of books to the consumer market can be seasonal and volatile

Develop special interest, academic and professional publishing where revenues are less volatile

Develop other revenue streams, including from rights and services, increasing the scope to enter annually renewing agreements


Increased dependence on internet retailing

Readers might not discover, and so buy, Bloomsbury's print and e-books sold through internet retailers

Grow expert marketing teams skilled in internet sales

Engage with multiple internet retailers

Increase focus on developing other marketing opportunities and other revenue streams, e.g. A&P digital products, rights and services

Grow e-book sales

Rights and services

Volatility of timing of closing rights and services deals

The timing for completing high margin rights and services deals can depend on the performance by multiple parties including the main customer

Increase the number of rights and services deals to reduce the dependency on individual deals


Generating new/non-renewal of subscription and services agreements

The pipeline of new products and agreements might be uneven

Senior managers are responsible for ensuring strong performance by Bloomsbury of its obligations and strong customer care



A customer or partner might not renew larger agreements that generate significant ongoing income

Increase the portfolio of products and agreements to grow income and reduce the dependency on individual agreements


Entrepreneurial risk

A deal may require upfront staff time and costs but fail to close resulting in lost investment

Similar to ordinary publishing risks: increase the portfolio of deals to leverage economies of scale and absorb volatility

Move to digital

Development of the digital book market

Consumer e-book prices may not hold up in the longer term

Continue to supply books in all formats through multiple digital delivery systems aligned with the demands of readers



Possible emergence of not yet known reading technology, e.g. involving subscription services for consumer books

Ensure the Group is positioned to take advantage of e-book (or any new format) growth in international markets

Use social media and other digital marketing to encourage direct sales to consumers

Develop non-consumer offering where revenues are less volatile and there is a direct relationship with the customers

Information and technology systems

Productivity of IT systems and data

Continuing to improve staff efficiency depends on the IT systems and data keeping pace with the needs of the business

Board level representation on steering IT strategy, implementation and IT operations

Financial reporting

Valuation of assets and provisions

Significant assets and provisions in the balance sheet depend on assumptions over the value, e.g. goodwill, advances, intangible rights and inventory, returns provisions

Prudent approach to assumptions.

Board approval of key assumptions.

Rigorous audit of valuations

Title acquisition

High advances sought by agents. World rights not acquired

Agents seek high advances for some authors

Publish more special interest trade books, e.g. Academic & Professional



Agents prefer to split territorial rights for English language publishing between US and UK

Focus acquisition on titles where world English rights are available

Concentrate on academic publishing where world rights are the norm

IP and copyright

Erosion of copyright

Erosion of copyright through government or other action

Continue policy of support for copyright and intellectual property rights as a fundamental facet of publishing


Piracy

Piracy of titles in print or digital form

Adopt robust anti-piracy policies

Ensure good digital rights management protection of e-books and digital formats

Participate in key industry anti-piracy initiatives

Overseas operations

Overseas offices

Growing offices in the US, Australia and India

One Global Bloomsbury structure of global publishing divisions supported by Group functions provides an effective internal control framework and oversight of the overseas offices

 

RELATED PART TRANSACTIONS

(From the Notes to the Consolidated and Company Financial Statements for the year ended 29 February 2016)

(Extract from Note 26)

27. Related party transactions

The Group has no related party transactions other than key management remuneration as disclosed in note 5.

 

(Extract from Note 5)

The Group considers key management personnel as defined under IAS 24 'Related Party Disclosures' to be the Executive Directors of the Company and those directors of the global divisions, major geographic regions and departments who are actively involved in strategic decision making.

Full details concerning Directors' remuneration are set out in the Directors' Remuneration Report on pages 58  to 74. The total remuneration of the Directors was £1,508,000 (2015: £1,489,000)

Total emoluments for Executive Directors and other key management personnel were:


Year ended 29 February

2016

£'000

Year ended 28 February

2015

£'000

Short-term employee benefits

2,887

2,859

Post-employment benefits

266

183

Share-based payment charges

472

490

Total

3,625

3,532

 

(Extract from Note 44)

47. Related Parties

Trading transactions

During the year the Company entered into the following transactions and had the following balances with its subsidiaries:


28 February

2016

£'000

 

28 February

2015

£'000

 

Sale of goods to subsidiaries

4,200

3,907

Management recharges

7,642

8,974

Commission payable to subsidiaries

1

-

Finance income from subsidiaries

68

51

Amounts owed by subsidiaries at year end

17,952

22,717

Amounts owed to subsidiaries at year end

30,547

34,488

All amounts outstanding are unsecured and will be settled in cash. No provisions have been made for doubtful debts in respect of the amounts owed by subsidiaries.

Key management remuneration is disclosed in note 5.

 


This information is provided by RNS
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