Financial Highlights
· Lower than expected publishing performance with revenue down 13%.
· Lower revenue combined with higher than expected one-off, non recurring costs impacted profit, resulting in a higher adjusted loss before tax of $8.7m (H1 2016 loss: $1.6m).
· Group overheads, though lower, included one-off, non-recurring costs related to personnel and IT systems upgrades, partially offset by favourable currency movements.
· Net debt rose 5% to $75.8m (H1 2016: $72.5m) and reflects a higher first half loss, partially offset by a net reduction in working capital.
· Owing to the increased second half weighting, the Group will not pay an interim dividend but will review the final dividend policy over the coming months in consultation with shareholders.
· The Board has received a preliminary approach to acquire the Company at a price it considers to be attractive and reflective of the inherent value of the business as a global publishing platform – and hence worthy of due consideration. Discussions with the bidder are at an early stage and there can be no certainty that an offer will be made or as to the terms of any such offer.
Commenting on the results, Chief Executive, Marcus Leaver said:
“As highlighted in our trading update in July, this set of results is below expectations. However, it needs to be set in the context of both a soft retail environment and the new reality of a higher second-half seasonality for the Group as a pure-play publishing business, especially with the addition of becker&mayer to our portfolio.
It has been a transitional period with the completion of the disposals of our non-core businesses while facing a challenging trading background in our key domestic markets. We have seen lower initial orders and reprints from some large customers. In particular, most of our adult imprints have performed below our expectations.
While we expect the soft retail environment to continue, we have an excellent publishing programme for the Autumn and the Holiday period – one of our strongest in the last few years. Order book visibility is healthy and our sales teams have the right plans in place to capture all possible opportunities. We have confidence throughout the Group in delivering a strong finish to the year.”