The vagaries of currency exchange helped turn an okay quarter into a good one for Harlequin in the second quarter ended June 30. Total revenue rose 4.4%, to C$124.1 million ($114.2 million at current exchange rates), and operating profit increased 12.2%, to C$19.7 million ($18.1 million). A weaker Canadian dollar added C$7.7 million to sales in the period, offsetting a C$2.5 million decline in underlying sales (sales excluding the impact of exchange rates). Profits benefitted from $2 million in foreign exchange equaling a small gain at constant exchange rates. Parent company Torstar said sales were down in both the North America retail and direct-to-market segments, offsetting increases in the Overseas markets.
For the first six months of 2009, total revenue increased 8.8%, to C$248.6 million, with most of the gain coming from foreign exchange. Profits increased C$5.8 million, to C$40.3 million with C$3.1 million due to the impact of foreign exchange. Underlying results were up in the Overseas and North America direct-to-consumer division and down in North America retail for both the second quarter and year to date.
Torstar said it expects slower sales growth for Harlequin in the second half of 2009, although the publisher will finish the year ahead of 2008. The first six months benefitted from digital sales in Japan which began in last year’s second quarter making for harder comparisons in the next six months. The uncertain economy in the U.S. also posses a risk for the publisher, Torstar said, particularly the chance of more reductions in consumer spending.