Regulatory announcements
Annual Financial Report
26 June 2013
Bloomsbury Publishing Plc ("Company") 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 shortly be available for inspection at http://www.hemscott.com/nsm.do:
- Company's Annual Report and Accounts for the year ended 28 February 2013
- Notice of the 2013 Annual General Meeting
- Form of Proxy
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 28 February 2013. The text below should be read in conjunction with the Company's final results for the period ended 28 February 2013 which were announced in unedited full text on 21 May 2013.
Enquiries:
Michael Daykin
Company Secretary
Bloomsbury Publishing Plc
Telephone +44(0)20 7631 5627
DIRECTORS' RESPONSIBILITIES STATEMENT
(From pages 44 of the Directors' Report of the Annual Report and Accounts for the year ended 28 February 2013)
Statement of Directors' responsibilities
The Directors are responsible for preparing the Directors Report, the Directors Remuneration Report, the Corporate Governance statement and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and Company financial statements for each financial period. The Directors are required under the Listing Rules of the Financial Conduct Authority to prepare Group financial statements in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union ('EU') and have elected under company law to prepare the Company financial statements in accordance with IFRS as adopted by the EU.
The financial statements are required by law and IFRS adopted by the EU to present fairly the financial position of the Group and the Company and the financial performance of the Group. The Companies Act 2006 provides in relation to such financial statements that references in the relevant part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation.
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 the Company and of the profit or loss of the Group for that period.
In preparing the Group and 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 adopted by the EU;
d. prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Company and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Directors' statement pursuant to the Disclosure and Transparency Rules
Each of the Directors, whose names and functions are listed in the Directors' Report, confirms that, to the best of their knowledge:
a. the financial statements, prepared in accordance with IFRS as adopted by the EU give a true and fair view of the assets, liabilities, financial position and profit of the Company and the undertakings included in the consolidation taken as a whole; and
b. the Directors' Report contained in the Annual Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole together with a description of the principal risks and uncertainties that they face.
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 United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
PRINCIPAL RISKS AND UNCERTAINTIES
(From pages 30 to 31 of the Risk Factors of the Company's Annual Report and Accounts for the year ended 28 February 2013)
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.
| Key area | risk | Description | Mitigation |
| Market | Volatility of general trade book sales Increased importance of internet retailing | * Sales of general trade books for both children and adults focus on bestsellers and can be both seasonal and volatile * As bricks and mortar reduce in number and range, internet retailing increases in importance |
* Develop academic and professional publishing where revenues are less volatile * Develop other revenue streams including from rights and services * Increase focus on developing other marketing opportunities and other revenue streams e.g. rights and services * Grow e-book sales |
| Reduction in number of booksellers | * Number of UK and US bookshops is reducing | * Ensure sales in the international market are maximised to reduce dependence on domestic sales in UK and US | |
| Increase in sales through supermarkets and other non- traditional outlets | * Many non-traditional retailers focus on bestsellers rather than range of titles | * Reduce dependence on bestsellers by developing other revenue streams e.g. academic and professional | |
| Decline in high-street bookshops | * Numbers of bookshops (both independent and chains) have declined | * Grow relationships with other retailers including independent booksellers, internet and supermarkets * Develop other revenue streams e.g. rights and services |
|
| 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 average the revenue recognition start point of deals |
| Entrepreneurial risk | * A deal may require upfront staff time and costs but may 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 | Shift from print | * E-books are increasing as a percentage of Group revenue | * Position Group publishing to ensure titles can be sold in digital format(s) |
| E-book sales plateau | * Steep rise in e-book sales in US and UK may plateau | * Broaden range of revenue streams e.g. subscription, rights and services * Ensure Group is positioned to take advantage of e-book emergence in international markets * Use social media and other digital marketing to encourage direct sales to consumers |
|
| Title acquisition | Retention of authors | * Authors (especially in general trade) are usually commissioned on a book by book basis | * Broaden publishing portfolio to reduce dependence of business on bestselling authors |
| High advances sought by agents | * Agents seek high advances for some authors | * Publish more non-general trade books e.g. academic and professional | |
| World rights not acquired | * 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 Piracy | * Erosion of copyright through government or other action * Piracy of titles in print or digital form |
* Continue policy of support for copyright and intellectual property rights as a fundamental facet of publishing * Adopt robust anti-piracy policies * Ensure good digital rights management protection of e-books and digital formats * Participate in key industry anti-piracy initiatives |
RELATED PARTY TRANSACTIONS
(From the Notes to the Consolidated and Company Financial Statements for the year ended 28 February 2013)
(Extract from Note 26)
26. 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 Directors of the Company and those directors of the 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 53 to 68.
Total emoluments for Directors and other key management personnel were:
| Year ended 28 February 2013 £'000 |
Year ended 29 February 2012 £'000 |
|
| Short-term employee benefits | 3,297 | 4,165 |
| Post-employment benefits | 189 | 154 |
| Share-based payment charges | 500 | 177 |
| Total | 3,986 | 4,496 |
(Extract from Note 42)
42. Related parties
Trading transactions
During the year the Company entered into the following transactions and had the following balances with its subsidiaries:
| 28 February 2013 £'000 |
29 February 2012 £'000 |
|
| Sale of goods to subsidiaries | 2,449 | 4,449 |
| Management recharges | 6,913 | 1,074 |
| Commission payable from subsidiaries | - | 249 |
| Commission payable to subsidiaries | 19 | |
| Finance income from subsidiaries | 254 | 289 |
| Amounts owed by subsidiaries at period end | 16,855 | 17,683 |
| Amounts owed to subsidiaries at period end | 21,121 | 17,304 |
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.
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