Longhorn Publishers narrowed its net loss by 28.3 percent in the six months to December 2024 as the company cut costs aggressively in response to a plunge in sales.
The firm’s net loss contracted to Sh148.6 million in the review period from Sh207.4 million a year earlier. Longhorn slashed its cost of sales to Sh165.8 million from Sh458.7 million as revenue fell by 46.9 percent to Sh525.8 million from Sh278.8 million.
The reduction in costs raised its margins substantially, with the gross profit rising to Sh112.9 million from Sh67 million.
Longhorn blamed the lower sales on the government’s delay in approving text books and other learning materials for this year’s learning in primary and junior secondary school.
The Kenya Institute of Curriculum Development (KICD) published the approved list of learning materials a few days before the opening of the first term, postponing purchases as publishers take weeks to supply the market.
“Revenue for the period decreased by Sh247 million, representing a 47 percent decline, compared to the previous period,” Longhorn said in a commentary on the results.
“This was mainly due to the delay in purchasing by the market owing to curriculum changes and delays in distributing the government orders.”
The curriculum changes affected books for Pre-Primary to Grade 9, with some titles yet to be supplied in various parts of the country.
Publishers are however optimistic of recovering sales gradually.
“We expect a stronger second half of the year to be boosted by revenues from the delayed government contracts across the region and private schools following the approval of all the new titles in January 2025,” Longhorn said.
Besides lower cost of sales, the Nairobi Securities Exchange-listed firm also benefitted from a reduction in operating expenses which fell to Sh155.8 million from Sh176.1 million. Longhorn did not incur an income tax expense in the review period and the year before.
