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Harry Potter and the Half-Blood Prince helped publisher Bloomsbury hit its earnings forecast for 2005 and amass £53.5m ($93m) cash to invest in future expansion.

The precocious wizard has fuelled Bloomsbury’s growth from a small, idealistic press, which raised £5.5m on floating in 1994, to an international heavyweight with a market capitalisation of around £265m and a string of acquisitions behind it.

It reported a rise in annual pre-tax profits of 23.6 per cent to £20.1m, in line with the company’s own forecast.

But with just one book remaining in the Harry Potter series, Bloomsbury must now show it can continue to prosper outside the shelter of Hogwarts.

“Our position as an international publisher is now firmly established, and we expect to see further benefits from this and the new areas of publishing that we are entering in the current year and beyond,” said Nigel Newton, Bloomsbury’s chairman, noting that trading had begun well in 2006.

Record sales of the latest Harry Potter title and a strong performance from international operations helped turnover rise 29.2 per cent to £109.1m in the 12 months to December, beating analysts’ expectations. Berlin Verlag, Bloomsbury’s German business, moved into profit while revenues from US operations were up 22.7 per cent.

Bloomsbury has used its cash windfall to acquire high profile titles and authors ranging from Douglas Coupland to Edward Said. The group invested £22.4m in future titles in 2005 but still ended the year with net cash of £53.5m. It has raised the total dividend for the year by 20 per cent to 3.6p.

Bloomsbury said it had set aside £15m to invest in non-fiction, seeking to cash in on the recent trend of celebrity biographies with new books by Take That member Gary Barlow and boxer Amir Khan. The group revealed on Tuesday it would also publish selected speeches of another celebrity bruiser - Chancellor Gordon Brown.

Iain Daly, analyst at Bridgewell, commented that the move to non-fiction could be “a tacit admission of the difficulty in investing in fiction titles at acceptable levels of return,” while Investec analyst Malcolm Morgan said, “The increasing levels of cash have placed a burden of expectation on the company.”

Bloomsbury said it would continue to pursue strategic acquisitions. It also announced a move into online publishing, releasing 24 books for electronic download at paperback prices. It expects small sales initially, but with potential to reach up to 50 per cent of fiction sales if readers take to the format.

“We firmly believe that the way forward is for publishers to host their own titles for electronic download,” the group said, echoing Mr Newton’s views on Google’s plans to scan books digitally, which he has called a ”landgrab” that was ripping off authors.

Shares were down 0.8 per cent to 358.2p in early London trade.

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