Random Reports Sales Rise

by Jim Milliot, PW NewsLine -- Publishers Weekly, 9/9/2004

Coming off a soft first six months of 2003, Random House reported that sales for the first half of 2004 rose 9.3%, to 810 million euros ($980 million), while operating EBIT (earnings before interest and taxes) jumped 158%, to 31 million euros ($37.5 million).

Sales were up in all of Random's major markets, led by strong sales in the company's English-language markets. Results were particularly strong in the U.K. and Australia and were also up in the U.S. Sales in the U.S. were negatively impacted by the weak dollar compared to the euro.

In his letter to employees, Random chairman Peter Olson said gains in North America were due to new bestsellers such as My Life, The Last Juror and Father Joe as well as solid performances by a number of backlist books, led by The Da Vinci Code (2.7 million copies printed in the first half of 2004) and Eragon. Random had 108 titles hit the New York Times bestsellers lists in the six month period, with 13 reaching number 1; both figures are ahead of last year's pace. Olson cited "enormously effective collaborative effort among our publishing, sales and support teams" for posting gains in "an uneven marketplace."

Olson was cautious about predictions for the second half of 2004. He observed that "any real upturn at book retail in 2004 has been largely unsustained," noting that "consumers were more frugal in their book purchases this summer than in the spring."

In areas outside of North America, sales at its German subsidiary, Verlagsgruppe Random House, rose, but earnings were hurt by restructuring costs and the integration of Heyne. Random's start-up operations in Asia got off to a good start, Random parent company Bertelsmann said, especially in Korea. Bertelsmann also reported that Bookspan "improved its result year on year."