Revenue at Harlequin fell 5.3% in 2010, to C$468.2 million ($482 million), while operating profit held relatively even, slipping to C$83.4 million ($85.4 million) from C$83.8 million in 2009. The decline was due mainly to currency fluctuations, parent company Torstar said.
According to Torstar, excluding currency changes, sales and earnings in Harlequin’s North American division both rose C$1 million. The increase was driven by digital sales which increased C$16.1 million, a gain that offset a decline in print books that led to a C$10.7 million decrease in retail revenue. Direct-to-consumer sales fell by C$4.1 million, due to lower volume.
In its overseas division, revenue rose C$6.8 million and profits increased C$2.5 million, excluding the impact of foreign exchange. The sales increase was due largely to the acquisition of the 50% stake in its German subsidiary that it had not owned, an acquisition that offset declines in Japan due to challenges in the print book market and lower digital revenue mainly due to the delivery of fewer digital manga titles under its agreement with Softbank.
Looking at 2011, Torstar said that while the Borders bankruptcy and transition from print to digital makes it difficult to predict Harlequin’s performance, “on balance, Harlequin expects full-year 2011 operating results to be stable excluding the impact of foreign exchange.” The company expects digital sales to increase in the year, while print sales to decline.
