Longhorn Publishers cut its net loss by 58.4 percent to Sh237.9 million in the financial year ended June 2024 as increased sales pulled it from the worst performance since listing on the Nairobi Securities Exchange.
The improved performance from its biggest loss of Sh571.33 million in the preceding financial year came on the back of revenue and other income growing by 43 percent to Sh1.54 billion, which the firm attributed to enhanced market penetration.
Longhorn said the performance would have been better were it not for the impairment losses brought about by curriculum changes that meant overhauling some of the textbooks it had already developed.
“The curriculum revisions proposed by the Presidential Working Party on education reforms in Kenya resulted in a drop in spending on books due to the anticipated changes in textbooks that would overhaul textbooks already developed from pre-primary 1 (PP1) to grade six (G6).
"This has necessitated further provisions being booked on inventory held and development cost,” said Longhorn in a commentary accompanying the results.
This marks the third straight year in a loss position for the publishing firm that has been grappling with an environment of reduced spending power of customers and an upsurge of book piracy and the secondhand textbooks market.
Longhorn saw its cost of sales rise by 37 percent to Sh1.21 billion while operating expenses reduced by 35.9 percent to Sh411 million.
The firm cut its borrowings by 15.8 percent to Sh1 billion, but finance costs increased by 12 percent to Sh204.6 million because of interest rate hike in the review period.
Longhorn said it has embarked on a new strategic period with the focus on increasing its market share and growing the Edtech —the digital business portfolio— in all its markets.
“Following the spin-out of our digital business through Longhorn Digital Ventures, we have seen tremendous progress in our first start-up, LoHo learning, which has already secured key partnerships with major Telecommunication service providers,” said Longhorn.
The firm will also be deepening its focus in emerging areas such as interactive textbooks, games, science simulations and teacher dashboard.
Following the revision in the textbooks from PP1 to G6, Longhorn anticipates a more stable period, enabling it to focus on market growth with textbooks that will have a much longer shelf life.
It added that it will continue investing in the new curriculum grades 10 to 12.
Longhorn operates in nine markets— Kenya, Uganda, Tanzania, Rwanda, Zambia, Malawi, the Democratic Republic of Congo, Cameroon and Ghana.
