DESPITE having to set aside #145,000 to cover related returns and bad
debts associated with the receivership of Pentos, former owner of
Dillons bookshops, publishers Cassell increased annual profits by 38% to
#827,000.
In its first year as a public company book sales rose 15.6% to #20.7m
helped by strong demand for the Catechism of the Catholic Church,
however the group experienced a 1% decline in gross margin. This
reflected sluggish business in the book chains and book clubs.
Dillons accounted for #1m of Cassell's sales last year while WH Smith
and Waterstones was reponsible for #2m of sales as were book clubs
worldwide.
Philip Sturrock, Cassell's chairman and chief executive, is supportive
of the Net Book Agreement (NBA) which determines minimum retail prices.
He said it was desirable to have a range of stockholding bookshops,
something which differentiated the UK from overseas bookmarkets.
Mr Sturrock said it remained the publisher's choice whether to
entirely abide by the NBA. Cassell's dictionaries are not covered by the
NBA.
The company is optimistic about its future prospects and remains on
the lookout for acquisitions, particularly US academic publishers.
Academic books make up around 12% of sales, with religious books
accounting for 9%. Cassell acquired Pinter Publishers earlier this year
which added two academic imprints, namely Pinter and Leicester
University Press.
It also expects to grow organically through selective development of
electronic publishing in the professional and academic areas. This year
the Catechism of the Catholic Church will be published both on floppy
disk and (together with Bible texts) on CD-ROM.
This year, Cassell intends to publish at least 750 new titles compared
with 600 last year. It has high hopes for High Fidelity by Nick Hornby
and will also be publishing major biographies of Michael Foot and Imran
Khan.
The flotation and good trading led to a positive cash balance of
#403,000 at the year-end. There is a maiden dividend payment of 3p per
share.
Cassell shares were steady at 133p.
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