Sales at Bloomsbury rose more than 16 percent, to £44.9 million for the six months ending August 31, driven by recent acquisitions and ebook sales that grew more than six-fold from a year ago, now at £2.5 million for the period. Like-for-like sales with the Continuum acquisition were still up 11.9 percent, but pre-tax profit declined to just £0.3, from £0.8 a year ago, due to restructuring costs and their relocation to new offices in London. With recent purchases, Bloomsbury’s Harry Potter cash stash is down to just under £9.5 million. UK sales were £30.8 million and US sales were […]
Earnings Reports
Accounting House of Horrors? What Agency Does to Amazon’s Reports
Ever since the agency model first appeared in early 2010 we’ve been writing about some of the unanticipated effects of that shift, and today we turn our attention to another previously overlooked ramification: what agency does to retailer accounting. In public Amazon opposed the agency model on behalf of protecting their power to price ebooks and offer discounts to their customers. But agency has an important accounting impact as well. For regular/wholesale ebook sales, Amazon books the full value of what the consumer pays. But for agency ebooks, under standard accounting rules the company only books the commission they receive […]
Big Orders for Amazon Devices Weigh On Profit Guidance, and Stock Price
Amazon reported third quarter sales of $10.88 billion after the close of the market on Tuesday, yielding net income of just $63 million (or 14 cents a share), and the reaction from investors was negative. The stock had already declined more than $10 a share (or 4.4 percent) in regular trading Tuesday ahead of the earnings announcement, and it fell sharply in after-hours trading and again this morning. At press time time this morning, shares were down about $27, or 12 percent, trading at just above $200 a share. While sales were towards the high end of the company’s own […]
McGraw-Hill Misses Estimates, As K-12 Sales Are Hit
McGraw-Hill reported sales and earnings below expectations and pared back their full-year earnings forecast this morning. Sales at McGraw-Hill Education, which will be kicked out of the corporate nest next year to stand on its own, fell 11.1 percent, to $937 million. Adjusted operating profit fell by the same percentage, at $314.7 million. The decline came almost entirely from the School Education group in particular, where declining state textbook adoptions drove a 21.4 percent drop in sales to $420.4 million. Higher ed and professional sales were “essentially flat.”
WHSmith Team Up With Kobo As They Report Full Year Sales Decline on Rising Profits
As Kobo continues to expand its reach around the world, they have now found a UK retailer to sell its ereader and ebook offerings: WHSmith announced Wednesday they have teamed up with Kobo as the “perfect partner” for ebooks. They will sell the Wi-Fi ereader for £89.99 (and the Kobo Touch for £109.99) and offer the more than 2.2 million ebooks for sale from Kobo’s catalog. Previously WHSmith’s ebookstore was powered by Overdrive. WHSmith also reported their annual earnings for the year ending August 31 Wednesday, with overall sales down 3 percent to £1.273b on a 5 percent rise in […]
Cengage Swings to Loss; Will Need to Refinance
Cengage had sales of $1.88 billion in their most recent fiscal year, ending in June, but the textbook company went from income of $47 million in the previous year to a loss of $37 million. Thirty-one percent of recents come from digital products and print-and-digital bundles. Bought by Apax Partners in the overvalued days of cheap and abundant credit in 2007 for $7.75 billion, the company still carries gross debt of $5.7 billion, which costs $480 million a year in interest. CEO Ron Dunn “says it will need to refinance within 18 months,” but also indicates to the FT there […]