Q3 Trading Update

19 Oct 2005 07:00

Quarto Group Inc19 October 2005 THE QUARTO GROUP, INC Q3 Trading Update Management's unaudited trading results for the quarter ended September 30, 2005,and for the nine- and twelve-month periods ending on the same date, excludingthe amortization of intangibles and exceptional items, against the prior periodcomparatives, and prepared under IFRS, are as follows: Q3 9 Months Trailing 12 Months 2005 2004 2005 2004 2005 2004 £000 £000 £000 £000 £000 £000 Revenue 28,397 25,657 66,595 56,706 89,639 76,433 -------- ------ ------- ------- ------- -------Gross profit 9,106 8,531 22,582 19,205 30,637 26,161Overheads (6,463) (6,097) (17,772) (14,800) (22,716) (19,054) -------- ------ ------- ------- ------- -------Operatingprofit 2,643 2,434 4,810 4,405 7,921 7,107 -------- ------ ------- ------- ------- -------EBITDA* 3,355 3,082 6,664 6,242 9,834 9,262 -------- ------ ------- ------- ------- ------- * earnings before interest, tax, depreciation and amortization, exceptionalitems, and corporate expenses not attributable to operations "The third quarter trading results leave us slightly behind where we expected tobe for the year to date but, as the trailing 12 months' operating results show,comfortably ahead overall. The principal impact has come from poor retailtrading in the UK, and it isn't clear whether this will pick up as we head intothe all-important final quarter of the year," commented Laurence F Orbach,chairman and chief executive officer of Quarto. "Fortunately, much of ourbusiness is in international co-edition publishing, where there is good forwardvisibility. It is very encouraging to report that 1001 Albums You Must HearBefore you Die, the latest title in our hugely successful 1001 series, hasreprinted in several major markets, even before going on sale. "The UK market (which accounts for approximately one-sixth of Group turnover) isparticularly difficult, and economic uncertainties persist elsewhere, but wehave sound reasons to believe that 2006 will be a solid year of growth forQuarto. The changes in our US publishing businesses that we have implementedduring this year will be bedded in; the investment we have been making inimproving their title ranges will translate into sales; the strong newco-edition lists appearing this fall will feed through into reprints andforeign-language editions; and cyclical factors will all favour us, subject, ofcourse, to currency and interest rate movements." Notes for Editors: Quarto is an international book publisher with two principal strands ofactivity: it publishes, under imprints owned by the Group, books and art printsin the US, the UK, and Australia; and it creates books that are licensed toother publishers for publication under their own imprints in many languagesaround the world. 2004 was Quarto's sixth successive year of increase in underlying EPS. Quartomade four acquisitions in the second half of 2004 and the first half of 2005: inthe USA, the UK, Australia and New Zealand. Enquiries: The Quarto Group, Inc. 020-7700 9000Laurence Orbach (Chairman & CEO)Mick Mousley (Finance Director) Bankside Consultants LimitedCharles Ponsonby 020-7367 8851 This information is provided by RNS The company news service from the London Stock Exchange