A new report from market analysts Plimsoll Publishing says that no less than 39 of the UK’s top 100 publishing companies are showing serious signs of financial weakness and could face an uncertain future.
Using publicly available data from Companies House, the analysts looked at the financial performance of the top 100 publishing companies registered in the UK and used their own methodology to assign each company a rating. They gave 39 companies a financial rating of ‘Danger’, meaning they are showing symptoms of financial distress – namely declining sales, high debts and low profits.
Plimsoll say that many of the 39 businesses need an urgent survival plan, either from an injection of capital, a radical cost reduction scheme or financial restructuring if they’re to continue to trade.
Similarly depressing stats from the report include:
- 31 companies made a pre-tax loss in their latest year of accounts
- 46 firms have seen their turnover decrease in the latest set of accounts
- One in five businesses have witnessed a profit decline in the last two consecutive years
Publishers are struggling for a variety of reasons, partly because many have struggled to adapt to the digital age and have been burdened by legacy print businesses, but also because of ad fraud (which has soaked up huge amounts of ad spend) and increased competition from US tech platforms.
On a slightly more positive note, more than half of publishers were rated from strong to mediocre:
| Plimsoll Rating | Number of Companies |
| Strong | 41 |
| Good | 6 |
| Mediocre | 9 |
| Caution | 5 |
| Danger | 39 |
David Pattison, Plimsoll’s senior analyst, commented: “We tested this method of analysis on a study of 351 previously failed companies, including all the latest retail failures, and this showed 320 had a caution or danger rating up to two years prior to their demise. This proves our method of analysis can identify the key characteristics of a failing company. If failures are predictable, and if enough warning can be given, the management has time to get a survival plan in place to save the company. It is clear from this study the publishing sector is going through a period of great change and the market is highly competitive.”
He added: “Danger firms have two options: they can hold their nerve and hope to trade their way out, or they can put a survival plan in place and look to consolidate their business. Once you known the warning signs you then need to act.”
Notes on Plimsoll’s methodology (quoted directly from a statement):
To compile the Publishing Top 100 Report, Plimsoll has analysed 3071 companies who operate in the UK Publishing industry and picked the largest 100 based on turnover. The companies included in the Top 100 report specialise in an array of publishing markets – ranging from newspaper publishers to book publishers. The data used to compile the Top 100 Analysis is based on the financial accounts for each company which are available at Companies House. Based on these accounts, Plimsoll has used its own methodology to analyse the financial health of each individual company as well as the industry average figures which are contained in the Plimsoll Analysis.
