Revenue at Houghton Mifflin Harcourt’s trade publishing division, now operating as HMH Books & Media, rose 11.2% in the first quarter of 2019 over the comparable period in 2018. The division posted adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $4.2 million compared to a loss of $837,000 in last year’s first period. Revenue in the most recent period was $40.8 million, up from $36.7 million a year ago.
The decision by trade group president Ellen Archer to change the name of the unit to HMH Books & Media was reflected in the division’s results. The revenue increase was attributed to licensing income derived from the second season of the Carmen Sandiego series now available on Netflix. The licensing income offset a decline in sales of print books, which HMH said was due to unfavorable comparisons to last year’s first quarter, when the Instant Pot and Whole 30 series posted strong sales. Despite the drop in book sales, an HMH spokesperson said it was seeing strong sales for Maybe You Should Talk to Someone, How to Raise Successful People, Sprawlball, and Little Blue Truck Springtime.
Also during the quarter, HMH Books & Media announced the formation of HMH Audio, which will produce about 75 audiobooks annually beginning this fall.
Sales for the entire company dropped 2.5% in the quarter, to $194.6 million, while the net loss rose to $117.4 million from $199.7 million a year ago. Revenue in the education division fell 6.1%, to $153.8 million.
HMH CEO Jack Lynch said results were in line with expectations. Lynch noted that 2019 is a strong adoption year for textbooks and that the company anticipates an upturn in sales during the year, finishing 2019 with a double digit increase in billings in its education segment over 2018.