Longhorn Publishers sank into its largest net loss of Sh949.6 million since listing on the Nairobi Securities Exchange after changes to the school curriculum forced the education publisher to make a Sh518 million provision on investments in books that are likely to become obsolete.
The Nairobi Securities Exchange-listed firm’s loss in the year ended June 2026 is nearly four times the Sh261.4 million loss recorded a year earlier, as Sh518 million impairment charges on old curriculum-related investments wiped out gains from higher sales.
The loss is the publisher’s worst since its listing on the NSE in 2012, highlighting the financial cost of adapting to Kenya’s revised Competency-Based Curriculum (CBC) and the phase-out of the 8-4-4 syllabus materials. Longhorn last returned a full-year net profit in 2022 at Sh39.91 million.
The trigger for the Sh518 million impairment was the approval of Grade 12 CBC books two months ago, which effectively closed the final remaining market for textbooks under the outgoing 8-4-4 system.
Longhorn managing director Simon Ngigi told Business Daily the approval meant the publisher could no longer rely on the old curriculum to generate new demand, prompting it to make full provisions for its remaining 8-4-4 book investments.
“Grade 12 CBC books were approved two months ago, thereby putting an end to the last of the 8-4-4 classes that were buying the old curriculum books. That was the trigger we needed to fully provide for all 8-4-4 related books,” Mr Ngigi said.
However, he explained that the provisions do not mean all the affected books have become immediately unsaleable. Form Three and Four learners are yet to transition to CBC, with the new curriculum expected to reach the two classes in 2027 and 2028, respectively.
The curriculum transition has exposed the challenges facing publishers holding investments in textbooks and other learning materials whose commercial value has diminished as schools move to revised syllabuses.
Mr Ngigi said the publisher expects to sell some of the books already provided for over the next year or so, offering a possibility of recovering part of the value of its old curriculum inventory.
The publisher’s impairment loss, in addition to the derecognition of previously recognised deferred tax assets amounting to Sh262 million, contributed to the deterioration in its bottom-line.
Longhorn said the financial year was also characterised by the continued implementation of the revised curriculum in its key markets, delays in institutional procurement and constrained funding for the business.
Despite these challenges, the publisher managed to grow revenue by 21 percent to Sh811 million from Sh672.1 million, supported by expanded market coverage and improved sales performance. However, the writing off saw the cost of sales jump 75.4 percent to Sh913.8 million.
The firm said it would have posted an operating profit of Sh16 million, excluding the curriculum-related impairment charges, compared with an operating loss of Sh20 million in the previous year.
The publisher’s financial position weakened further, with total assets falling 40.2 percent to Sh1.33 billion, while shareholders’ equity moved from a positive Sh18.1 million to a negative Sh1.03 billion.
Longhorn said the completion of key curriculum revisions provides a platform for renewed sales momentum, with investments in curriculum-aligned intellectual property expected to support future growth.
The company is also banking on digital learning solutions through its LoHo Learning platform, product diversification and expansion into new customer segments to improve recurring revenues.
It said it would continue to pursue opportunities to improve gross margins, strengthen subsidiary performance and increase cash generation as it seeks to rebuild its market position.