Egmont is a leading Nordic media group that includes Nordisk Film, Norway’s TV 2, and PlayStation distribution along with book publishing. The company is active in 30 countries with 6,600 employees.
Egmont operates under The Egmont Foundation, a charitable organization. The foundation grants an annual share of the profits from the media companies to projects related to helping children in need.
Egmont created a new publishing division in November 2013 with Egmont Kids Media and Egmont Magazines named Egmont Publishing. The unit produces over 700 weekly and monthly magazines, as well as children’s books including licensed brands. Egmont Publishing also creates digital content and offers e-commerce services.
Egmont Books consists of Norway's largest publisher, Cappelen Damm, and Denmark's second-largest publisher, Lindhardt og Ringhof. Egmont Books publishes fiction and non-fiction, children's books, audiobooks, e-books and educational materials. Egmont’s non-Scandinavian book publishing activities include the Turkish publisher Dogan Egmont and the Australian press Hardie Grant.
Analysis & Key Developments
The Egmont Group announced its best year to date in 2014, with operating profits totally 131 million EUR, up from 102 million EUR in 2013. Growth was driven by a strong performance of Play Station 4 in Egmont’s Nordisk Film division.
The Publishing division, formed in 2013 with Egmont Kids Media and Egmont Magazines, recorded a decrease in revenues in 2014 from 660 million EUR (re-stated to 617 million EUR) to 600 million EUR, despite a strong performance in Scandinavia and restructuring improvements. Germany, Poland and the UK were also strong contributors, while currency and crisis-related costs incurred by businesses in Ukraine and Russia had a negative impact of 5 million EUR on operating profit to 35 million EUR.
Egmont’s Books division and Norway’s largest publisher, Cappelen Damm, continued to strengthen its market position with 10% growth in a challenging market. According to amendments to the International Financial Report Standards the company is no longer allowed to include revenues from Cappelen Damm in the consolidated financial statements. Revenue including Egmont’s share of Cappelen Damm account for 136 million EU and is in line with the previous year. Revenue without Cappelen Damm totalled 47 million EUR in 2014.
The acquisition of the Swedish Forma Publishing Group from ICA Gruppen added six magazine brands to the portfolio and made Egmont Publishing Sweden’s second-largest magazine publisher.
In January 2015, the company shut down its American publishing division. Egmont Publishing decided to sell U.S. division in October, as the division failed to establish a market leading position in the States. The U.S. division was established in 2008 and published children's titles in the elementary, middle grade and teen segment. Rob McMenemy, CEO of Egmont Publishing International, said the U.S. business "does not fit" with the company's strategy. In February 2015, Minneapolis-based Lerner Publishing Group acquired nearly 100 Egmont USA titles that will be incorporated into Lerner’s imprints. According to McMenemy, Egmont will from now on operate in countries where it is one of the top three children's publishers. In the USA, Egmont was "tiny" and “had no realistic proposition of changing that."
Germany’s Egmont Verlagsgesellschaften could not reach previous year’s result, despite strong children series Biba & Tini and Minecraft, a solid performance of the romantic imprint Egmont LYX and double-digit growth in the Manga segment.
In 2014 Cappelen Damm further boosted its online sales of physical and digital books, with books and digital products recording 30% growth.
The strongest title of the children’s book segment within the Publishing division were the game-related books based on Minecraft, selling 75.000 copies in Sweden, and in the UK and Australia even several millions.
Lindhardt og Ringhof boasted two of the year’s biggest bestsellers, John Williams’ Stoner and Donna Tartt’s The Goldfinch. Leif Davidsen’s travel book Steinbecks spøgelse and Michael Katz Krefeld’s crime novel Savnet were also among the bestselling titles in 2014. Non-fiction maintained its market-leading position in cookbooks, lifestyle and culture. Topping the bestseller lists in this segment were Claus Meyer’s Bageskole, Søren Anker Madsen’s Ghita Nørby and Henning Knudsen’s botanical work Flora Danica. Denmark’s largest schoolbook publisher, Alinea, sold a record-breaking number of printed schoolbooks, and sales of digital educational media continued to climb. (Company information)
Egmont Publishing recorded a lift in revenues in 2014 due to costs incurred from the 2013 merger and headwinds in the children's media market. Magazine sales account for 80% of divisional earnings. Egmont Publishing contributes 40% of Egmont's overall revenue.
Egmont Books closed fiscal 2013 with a resilient performance. Cappelen Damm maintained a leading role in general literature and upper-secondary school textbooks, noting a boost in online sales of physical and digital products and growth of more than 30%. Lindhardt og Ringhof managed to increase profit by 38% in 2013, noting a record demand for audiobooks, e-books, and other digital products. Alinea held its position as Denmark's largest supplier of educational materials, increasing digital learning media sales by 50%.
Egmont Publishing bought three Norwegian home decorating magazine titles from Schibsted after recording a 40% increase in Lev Landlig, a previously acquired home and country living magazine that led 2012 in circulation growth.
Lindhardt og Ringhof acquired Forlaget Per Kofod, a publishing house with a list that includes Paul Auster and Siri Hustvedt.
Egmont ventured into e-book streaming with the launch of ebib.dk, and Lindhardt og Ringhof is participating in Danish start-up Mofibo, which plans to introduce e-book streaming to Danish readers. Mofibo will have 5500 titles available at a monthly price tag of 99 DKK for unlimited access.