First quarter sales at Houghton Mifflin Harcourt’s trade segment inched ahead 0.6% in the first quarter ended March 31, over the first period of 2017. While sales moved up slightly, to $36.7 million, the net loss also rose modestly. The latter his $4.3 million in the quarter, compared to $4.1 million a year ago.
HMH attributed the sales rise to “higher licensing income along with print title sales such as the Instant Pot series and Whole30 series." The dip in earnings was largely to a change in the sales product mix—last year HMH sold lots of The Handmaid’s Tale and 1984 e-books, which have higher margins than print.
Revenue in HMH’s education division fell 1.3% in the quarter, compared to 2017, dropping to $183.0 million. The group’s net loss, however, was cut to $59.3 million from $70 million in the first quarter of 2017.
The small sales decline was attributed to lower net sales of reading programs in the third year of California's English Language Arts adoption as well as the non-recurrence of the $5 million one-time fee HMH recognized last year. That decline was offset in part by higher sales at HMH's Heinemann unit, which focuses on intervention, supplemental and assessment products as well as professional services.
In a prepared statement, HMH CEO termed the first quarter results “solid” start to the year. HMH's CFO, Joe Abbott, said the good start combined with expectations for the remainder of 2018 give the publisher confidence it will meet its financial targets for the year.