Digital content sales rose 64% in the first quarter ended March 31 at Simon & Schuster, helping to lift total revenue 14%, to $176 million. Operating income before depreciation and amortization (and before impairment charges) rose 43%, to $10 million; both quarters has charges of $2 million.

In addition to higher digital sales, which accounted for 26% of total revenue, sales of print books also rose in the quarter. CEO Carolyn Reidy said S&S benefitted from a carry over of some strong holiday titles such as Steve Jobs and 11/22/63 that did well in print and well as digital editions and also had some hot selling new titles that resulted in seven new #1 titles in the period. Among the new bestsellers were Kill Shot by Vince Flynn, The Lost Years by Mary Higgins Clark, Lone Wolf by Jodi Picoult, and The Magic by Rhonda Byrne in paperback. Overall, the adult division posted a "signficant" sales increase, while audio sales also had a solid gain, Reidy said. All of S&S's international units had increases in the quarter, although the children's unit saw sales fall by less than 5%. Reidy attributed the decline to the timing of the release of new titles and predicted that the division would bounce back in the current quarter.

With e-books more of an established business than even a year ago, Reidy said S&S is looking for digital sales to increase about 70% this year, and she thinks digital will account for about 28% to 30% of total revenue for the full year, although she acknowledged that it is hard to determine where the balance of print and digital will be. She was encouraged however, that total print and digital sales seem to be growing. "We are not losing readers," Reidy said.

As for the strong showing on the bottomline, Reidy said that was a reflection of the various structrual changes S&S has made since she took over as CEO ranging from reorganizing the sales force to changing phone systems. "We've taken a lot of costs out of the business," she said. The 43% gain in OIBDA would have been higher except for various legal fees, believed to be associated with the different investigations into the agency model. The objective for S&S now, Reidy said, is to continue to grow revenue at the company for the full year and with a strong list throughout 2012 Reidy is optimistic S&S can hit that objective.

S&S has had little to say on its agreement to settle with the Department of Justice, and Reidy said the focus "will be on implementing what we've ageed to" and to "put it behind us."