Information Agency Credinform presents a review of trends in publishing activities.

The publishing houses with the highest volume of annual revenue (TOP-10 and TOP-1000) have been selected for the ranking, according to the data from the Statistical Register for the latest available accounting periods (2015 and 2016). The analysis was based on the data from the Information and Analytical system Globas.

Net assets

It is an indicator of fair value of corporate assets that is calculated annually as assets on balance less company’s liabilities. Net assets value is negative (insufficiency of property) if liabilities are larger than the property value.

^*) — growth or decline values compared to prior period are highlighted green and red respectively in columns 4 and 5.

Picture 1. Change in average net asset value of the largest publishing houses in 2007 — 2016

Sales revenue

In 2016 sales revenue of 10 industry leaders amounted to 45% of total revenue of TOP-1000 companies. This is an indicator of a relatively high level of monopolization within the sector (Picture 2).

Picture 2. TOP-10 companies by their share in 2016 total revenue of TOP-1000 companies

In general, revenue tends to decline (Picture 3).

Picture 3. Change in average revenue of publishing houses in 2007— 2016

Profit and loss

In 2016 profit of 10 industry leaders amounted to 66% of total profit of TOP-1000 companies (Picture 4).

Picture 4. TOP-10 companies by their share in 2016 total profit of TOP-1000 companies

Average profit values of companies of the sector within a decade tend to decline (Picture 5).

Picture 5. Change in average profit of the largest publishing houses in 2007 — 2016

Average profit values of TOP-1000 companies for three years tend to decline, as well as average loss value (Picture 6).

Picture 6. Change in average profit and loss of the largest publishing houses in 2014 — 2016

Key financial ratios

During the last decade industry average values of liquidity coverage ratio were within the recommended value — from 1,0 to 2,0 (Picture 7). In general, the ratio value tends to increase.

Liquidity coverage ratio (a ratio of current assets to current liabilities) reveals the sufficiency of a company’s funds for meeting its short-term liabilities.

A calculation of practical values of financial ratios, which might be considered as normal for a certain industry, has been developed and implemented in the Information and Analytical system Globas by the experts of the Information Agency Credinform, having taken into account the current situation in the economy as a whole and in the industries. The practical value of liquidity coverage ratio of publishing houses amounted from 0,75 to 3,33 in 2016.

Picture 7. Change in average values of liquidity coverage ratio of publishing houses in 2007 — 2016

The return on investment ratio (Picture 8) was not stable during the decade, tending to decrease. It is a ratio of net profit to shareholders’ equity and noncurrent liabilities, and it demonstrates benefit from shareholders’ equity engaged in business activity and long-term raised funds of the company.

Picture 8. Change in industry average values of return on investment ratio of publishing houses in 2007 — 2016

Assets turnover ratio is a ratio of sales revenue to average total assets for the period, and it measures resource efficiency regardless of the sources. The ratio indicates the number of profit-bearing complete production and distribution cycles per annum.

During the decade, this activity ratio tended to decrease in general (Picture 9).

Picture 9. Change in industry average values of assets turnover ratio of publishing houses in 2007 — 2016

Activities structure

Companies that specialize in wide-profile publishing activities have the largest share in total revenue of TOP-1000 companies (Picture 10).

Picture 10. Types of activity by their share in total revenue of TOP-1000 companies, %

77% companies of TOP-1000 are included in the register of small and medium-sized businesses of the Federal Tax Service of the Russian Federation, among them 35% are micro enterprises, 40% are small businesses, and 2% are considered medium-sized businesses.

Key regions of activity

TOP-1000 companies are unevenly located throughout Russian territory, and are registered in 71 region (Picture 11).

Picture 11. TOP-1000 companies by Russian regions

Financial position score

Assessment of financial state of TOP-1000 companies indicates that most of the companies have an average financial standing (Picture 12).

Picture 12.TOP-1000 companies by their financial position score

Solvency index Globas

Most of TOP-1000 companies have got a superior, high, strong and medium Solvency index Globas,that indicates their capability to meet liabilities timely and in full (Picture 13).

Picture 13. TOP-1000 companies by Solvency index Globas

Therefore, a comprehensive assessment of the largest publishing houses, that considers key indexes, financial figures and ratios, is indicative of negative trends in the sector.

Information agency Credinform represents the ranking of the largest Russian publishing houses. Enterprises with the largest volume of annual revenue (TOP-10) were selected for the ranking, according to the data from the Statistical Register for the latest available periods (for 2015 and 2016). Then they were ranked by net profit ratio (Table 1). The analysis was made on the basis of the data of the Information and Analytical system Globas.

Net profit ratio (%) is calculated as a relation of net profit (loss) to sales revenue and characterizes the level of sales profit. There is no normative value for the indicator. It is recommended to compare enterprises of one industry, or change of the ratio in the course of time of a certain company. A negative value of the ratio indicates a net loss. A high value shows an efficient operation of an enterprise.

The experts of the Information agency Credinform, taking into account the actual situation both in the economy as a whole and in the sectors, has developed and implemented in the Information and Analytical system Globas the calculation of practical values of financial ratios that can be recognized as normal for a particular industry. For publishing houses the practical value of net profit made from 7,78% in 2016.

For getting of the most comprehensive and fair picture of the financial standing of an enterprise it is necessary to pay attention to all combination of indicators and financial ratios.

The average value of the net profit ratio of TOP-10 enterprises is much higher than the industry average. One company from the TOP-10 list increased revenue and net profit indicators in 2015 — 2016 compared to previous periods (marked with green filling in columns 2 — 5 of Table 1). Other companies decreased revenue or profit indicators or have a loss (marked with red filling in columns 2 — 5 of Table 1).

Picture 1. Net profit ratio and revenue of the largest Russian publishing houses (TOP-10)

The industry average indicators of the net profit ratio were below the practical value of 2016 over the past 10 years, with a downward trend (Picture 2).

Picture 2. Change in the industry average values of the net profit ratio of the largest Russian publishers in 2007 — 2016