U.K. Harry Potter Publisher, Bloomsbury, Reports Large Profit Fall

Bloomsbury, the UK publisher of the hit Harry Potter series has announced a large fall in profits for 2006.

The announcement regarding Harry Potter publisher, Bloomsbury came today and stated that in 2006 they saw a fall on 74 percent in profits. 2006 was a year in which no new Harry Potter book was published.

In 2005 Bloomsbury reports profits of £20.1 million GBP (around $50 million US) and in 2006 profits fell to just £5.2 million GBP (around $10.2 million US). It has been the normal trend in the profits of Bloomsbury to rise especially in the year a new Harry Potter book is released. This profit announcement is the first report of a loss for Bloomsbury in 12 years. The figures for 2006 came as no surprise, as Bloomsbury issued a statement last December that its profits for 2006 were down. The December statement came after Christmas books sales did not reach anticipated targets.

2007 will bring another big year of profits for Bloomsbury as the seventh and final Harry Potter book; 'Harry Potter and the Deathly Hallows' is released on July 21. Bloomsbury has already begun a strategy to continue its growth in a post Harry Potter era.

The chairman of Bloomsbury, Nigel Newton, said that the publisher was working hard to implements its growth strategy. This strategy includes finding and promoting new authors, acquisitions and Internet initiatives. Newton believes that all of these strategies will be beneficial, he said about them, "all of which we believe will enhance and strengthen our position as a leading publisher."

Bloomsbury has enjoyed enormous success from being the U.K. publisher of the Harry Potter books. It is the first publisher to agree to publish the book and introduce this now best selling series to the world.

However, with the end of the Harry Potter series approaching, Bloomsbury is now under increased pressure to find ways to boost its profits. In the past they have been able to count on the publication of soft cover versions of the Harry Potter books to help profits but once the frenzy over book seven dies down this will no longer be a realistic source of increasing profits.

The main locations for Bloomsbury acquisitions have been in Germany and the U.S. The new U.S unit appears to be making a difference; it reported an increase in sales during 2006 with a 36 percent rise. The U.S unit of Bloomsbury also plans to expand and begin publishing business, historical and science material. At the German arm of Bloomsbury profits also are looking up. The unit reported a rise of 7.5 percent for 2006.

The profit report just announced by Bloomsbury said that the company's turnover for 2006 took a 34 percent fall. The turnover for 2006 was £74.8 million GBP compared to a turnover of £109.1 million GBP in 2005.

The final Harry Potter book will make publishing history on July 21 when it becomes the largest ever book launch. It is already at the top of both the U.K and U.S. Amazon bestseller lists.

Sources
http://news.bbc.co.uk/2/hi/business/6520669.stm
http://www.bloomberg.com/apps/news?pid=20601102&sid=aaaA6v2yLvOw&refer=uk
http://today.reuters.com/news/articleinvesting.aspx?type=marketsNews&storyID=2007-04-03T075859Z_01_L03726791_RTRIDST_0_BLOOMSBURY-RESULTS-UPDATE-2.XML