Bastei Lübbe AG shows continued positive development in its core business of 'Books' and 'Novel Booklets'

Bastei Lübbe AG shows continued positive development in its core business of "Books" and "Novel Booklets"

• Good Christmas season confirms positive business trend
• Core business improves EBIT to EUR 3.6 million with EUR 62.1 million sales revenue
• "Books" segment with clear programme strategy frequently represented on bestseller lists

Cologne, 13 February 2020 - Bastei Lübbe AG (ISIN DE000A1X3YY0), which is listed in the Prime Standard of the Frankfurt Stock Exchange, published its results for the first nine months of the financial year 2019/2020 today. Accordingly, Bastei Lübbe AG's sales revenue development remains on track for the annual target and benefited from a good Christmas business in the core segments. In the first nine months from April 1 to December 31, 2019, the Group generated total sales revenue of EUR 70.6 million (previous year EUR 73.5 million), slightly below the previous year's figure as expected.

Consolidated earnings before interest and taxes (EBIT) were negatively impacted by non-cash impairment losses of EUR 13.0 million in the "Games" segment and declined to EUR -8.2 million compared with EUR 2.1 million in the same period of the previous year. The EBIT margin was -11.6% (previous year: 2.8%). "Adjusted for this extraordinary item, EBIT would have more than doubled to EUR 4.8 million and the EBIT margin would have risen to 6.9 %," explains CFO Ulrich Zimmermann.

"The positive development of the core business consisting of the "Books" and "Novel Booklets" segments continues", explains CEO Carel Halff and adds: "With broadly stable sales revenue of 62.1 million euros, we have increased EBIT in this business by 57% to 3.6 million euros. In addition, we have again reduced net debt substantially to EUR 6.2 million (previous year EUR 17.8 million). We are making much faster progress here than planned."

Sales revenue of EUR 56.2 million in the "Books" segment were slightly below the previous year's figure. Based on the success of the efficiency program launched in January 2018 and the resulting improved cost structure, the segment EBIT improved as planned to EUR 2.3 million.

"Our program strategy continues to successfully focus on clearly defined target groups, as with our New Adult Imprint LYX, which is specifically aimed at young women and regularly captures the TOP 1 places on the SPIEGEL bestseller list. But also, in the traditional programme segments of 'historical novels', sagas/family epics and popular non-fiction, we were able to occupy the top positions of the bestseller lists with female authors Rebecca Gablé, Marie Lamballe and the author duo Marc Friedrich/Matthias Weik, sometimes for weeks at a time. In the meantime, Jeff Kinney has again crossed the finish line as a sure TOP-1 candidate with volume 14 of the children's comic novel series "Diary of a Wimpy Kid: Wrecking Ball"," says Klaus Kluge, Program and Marketing Director.

In the first nine months of 2019/2020, the "Novel Booklets" segment generated sales revenue of EUR 6.0 million compared to EUR 7.7 million in the previous year. The segment EBIT increased to EUR 1.3 million. The Puzzles division was sold effective 31 May 2019.

Revenues in the "Games" segment amounted to EUR 8.5 million in the period from April to December of the financial year. The segment EBIT declined significantly from EUR -0.2 million in the previous year to EUR -11.8 million. This is due to goodwill impairment of EUR 4.9 million and recognized computer and video games of EUR 8.1 million. The backdrop is the disappointing market reaction to the in-house developments that have been associated with high investments. Together with the co-shareholders and the management, all options for restructuring and changing the business model are currently being examined.

Adjustment of earnings forecast
Due to the necessary impairments in the "Games" segment, the Management Board has adjusted its forecast for the 2019/2020 financial year accordingly.

The Management Board continues to expect consolidated Group sales revenue in the current financial year to be between EUR 85 and 87 million. For Group EBIT, it expects a significantly reduced result of probably EUR -10.5 million to EUR -6.7 million (previously: EUR 3.5 - 5.3 million) compared to the previous forecast due to the impact from the "Games" segment.

The aforementioned reduced forecast for Group EBIT will continue to be reviewed by the Management Board on an ongoing basis, in particular also taking into account the examination of options for the restructuring and realignment of the business model in the "Games" segment, and will be adjusted and published again if necessary.

The financial planning of the Bastei Lübbe Group also assumes that net debt as at 31 March 2020 should be around EUR 10 million (previously: EUR 15 million; previous year: EUR 17.8 million).

The "Books" segment is key to the future sales revenue development of Bastei Lübbe. Here, the company is consistently looking ahead and will further expand its program strategy in the coming months. "Courage to innovate on the one hand, a clear focus on the market's success themes on the other, while at the same time sharpening and differentiating our program profiles", is the strategy of the future Program Director Simon Decot, which is already bearing fruit with the coming spring program. "For example, starting this spring we will be offering modern lifestyle and health themes under Lübbe Life, Quadriga will be serving the political non-fiction market, and with Eichborn we want to establish ourselves firmly in the literary entertainment market in the medium term."

The quarterly statement for the first nine months of the financial year 2019/2020 of Bastei Lübbe AG is available for download on the internet at www.luebbe.com/en/investor-relations/financial-reports/quarterly-reportsebbe.com/en/investor-relations/financial-reports/quarterly-reports.

About Bastei Lübbe AG:

Bastei Lübbe AG is a German publishing house with headquarters in Cologne specialised in the publication of books, audio books and e-books with fiction and popular science content. The company's core business also includes the periodically published puzzle magazines and novel magazines. With its total of twelve publishing houses and imprints, the Bastei Lübbe group of companies currently offers around 3,600 titles in the areas of fiction, non-fiction as well as books for children and young adults. In the growing segment of hardcover fiction books, the company has been one of the market leaders in Germany for many years. At the same time, Bastei Lübbe is an engine for innovation in the area of digital media and distribution channels, among other things by the production of thousands of audio and eBooks. This includes the stake in the game publisher "Daedalic Entertainment".
With annual sales revenue of approx. EUR 95 million (financial year 2018/2019), Bastei Lübbe AG is one of the largest medium-sized publishing companies in Germany. The shares of the company have been listed in the Prime Standard segment on the Frankfurt stock exchange (GSIN A1X3YY, ISIN DE000A1X3YY0) since 2013. Further information is available at www.luebbe.com.

Contact Bastei Lübbe AG:
Barbara Fischer
Head of Press and Public Relations
Tel.: +49 221 / 82 00 28 50
E-Mail: barbara.fischer@luebbe.de