Publishers began 2017 on a positive financial note: all four companies that reported results for the first quarter of the year had sales gains over the first period of 2016. Further, the three publishers that reported earnings all showed improved bottom lines.
The largest revenue gain in the quarter came in the Houghton Mifflin Harcourt trade division, where sales were 15.9% higher in the quarter ended March 31 than in the same period in 2016. The division also drastically cut its loss.
HMH attributed the revenue increase to sales of the Whole30 Cookbook and Tools of Titans, as well as to more e-book sales and fewer returns. The smaller loss was due in part to the growth in e-book sales, which provide larger margins. The improved results were announced a few days after HMH laid off about 20 people in the trade group as part of a companywide restructuring.
The purchase of Adams Media in late 2016 and a string of bestsellers led Simon & Schuster to an 11% increase in revenue in the first quarter of 2017 compared to the first period last year, and a 7.7% increase in operating income. S&S CEO Carolyn Reidy noted that all four of the company’s operating divisions had gains in the quarter, with three posting double-digit increases. The biggest improvement came in the audio group, led by a 35% increase sales of digital audio, “but the adult group wasn’t far behind,” Reidy said. Though digital audio sales were up in the period, e-book sales fell.
Lagardère reported that sales in its publishing group rose 6.1% in the first quarter, to €440 million ($447 million), from the first quarter of 2016. Revenue in its American subsidiary, Hachette Book Group, was up 4.1%, excluding a $19.5 million contribution from the publishing division of Perseus, which HBG bought in March 2016. According to Lagardère, the increase at HBG was due to solid sales in its Center Street division, led by good performances of Trump’s War and The Shack.
HarperCollins had gains in both sales and earnings in the quarter ended Mar. 31, 2017, which is the third period in the company’s fiscal year ending June 30. The company credited strong sales from the general adult group, where Hidden Figures and Hillbilly Elegy led the way, according to HC parent company News Corp.
HC’s expansion of its foreign-language business drove international sales gains, News reported. News CEO Robert Thomson said he also sees the potential for more growth overseas. On the digital front, sales increased 7% in the quarter from the same period last year, led by gains in digital audiobook sales. Digital sales represented 22% of consumer revenue in the quarter.
First-quarter Results, 2016–2017
($ in millions)
|Houghton Mifflin Harcourt Trade|
|Simon & Schuster|