Sales in Houghton Mifflin Harcourt’s trade division rose 9% in 2013, to $170.7 million, and adjusted EBITDA declined to $24 million from $29 million in 2012. For all of HMH, total sales increased 7%, to $1.38 billion, as sales in the education segment rose 6.5% to $1.21 billion. Adjusted EBITDA for the entire company rose to $325 million from $320 million, although the net loss rose to $111.2 million from $87.1 million in 2012.
HMH said the improvement in the trade group was led by sales in the young readers and cookbook categories. The division also worked with the education group to develop direct to consumer offerings in the year, with HMH launching the Academy series, an at-home, on-demand digital learning environment. The debut of Curious George apps also met with a good reception. The trade group’s revenue gain in 2013 came despite a 12% drop in fourth quarter sales that was attributed to strong sales of several J.R.R. Tolkien titles in the final period of 2012.
HMH trade president Gary Gentel noted that among the bestsellers in the adult group in the year were How Children Succeed and The Essential Scratch & Sniff Guide to Becoming a Wine Expert . E-book sales accounted for 22% of overall adult sales in the year, Gentel added.
In the young readers division sales were up in all areas, including frontlist where HMH has expanded its publishing of teen-related fiction. This biggest gains, however, were led by higher backlist sales related to increased interest “in the Common Core, Franchise Brands generally led by increased sales of Curious George titles, and YA and Middle Grade Fiction,” Gentel said. E-book sales represented 7% of young readers revenue.
HMH said it expects total revenue in 2014 to increase 5% to 8% driven by gains in the education group due to more sales opportunities in both adoption and open markets in the year.