HarperCollins closed out the fiscal year ended June 30, 2020, with a 3% drop in revenue in the fourth quarter compared to the final quarter of fiscal 2019. Revenue fell to $407 million, from $419 million.
Earnings, however, increased 9% over last year’s fourth quarter, to $47 million. But the improvement in fourth quarter profits was not enough to prevent earnings for the full year from dropping 15%, to $214 million. Revenue fell 5%, to $1.67 billion, compared to fiscal 2019.
HC parent company News Corp attributed the fourth quarter revenue decline primarily to “lower retail sales of foreign language titles and in Christian publishing due to store closures caused by COVID-19, partially offset by the success of Magnolia Table, Volume 2.”
With many bookstores closed because of the pandemic, digital sales increased 26% in the quarter compared to the prior year. That increase was driven primarily by growth in e-book sales, which rose 31%, while digital audio sales increased 17%, News Corp CFO Susan Panuccio reported. Digital sales represented 29% of HC’s consumer revenues for the quarter.
The 9% increase in quarterly EBITDA (earnings before interest, taxes, depreciation, and amortization) was attributed to cost savings and the mix of titles.
For the full year, the 5% revenue decline was largely attributed to difficult comparisons to the prior year. Despite the big gains in the fourth quarter—Panuccio called it the strongest digital sale performance in years—digital sales for the year increased a relatively modest 7% compared to the prior year, primarily driven by the continued growth in downloadable audiobook sales and higher e-book sales.
Panuccio gave a brief insight into how sales have progressed since the new fiscal year began July 1, saying last month that online sales for HC continued to be strong as physical stores slowly began to reopen.