Harlequin reported higher results last week for the second quarter ended June 30 and also announced the creation of a new position to oversee its North American retail sales efforts.

The North American retail market, particularly in the U.S., has been Harlequin's strongest performing unit this year and was largely responsible for driving operating profit up 16.3%, to C$29.2 million ($21 million), in the second quarter. Sales inched ahead 0.4%, to C$145.2 million ($103 million), with the gain limited by the strong Canadian dollar. Sales gains in the U.S. were led by large increases in Harlequin's single-title program, which offset declines in unit sales in Harlequin's direct-marketing division. The direct-response division "is under pressure," Bob Steacy, CFO at Torstar, Harlequin's parent company, told analysts in a conference call, while the single-title program benefited from the release of more titles. Through the first six months of the year, Harlequin's single-title sales are up 60% over what Steacy conceded was a "small number."

Harlequin's international operations had a mixed second quarter, with unit sales off in the U.K. and Japan and soft sales in the Spanish market due to economic problems in Latin America. To improve the U.K. performance, Torstar has appointed Pam Laycock managing director of the subsidiary.

Despite a few soft spots, Torstar executives said they are confident Harlequin will have a record year in 2003. They acknowledged, however, that sales growth in the second half of the year is likely to be slower than the first six months, due to a slower single-title release schedule. For the first half of the year, sales rose 2%, to C$295 million, and operating profit was up 11.7%, to C$52.9 million.

To help boost sales in the North American retail market, Harlequin has named Sharon Hails to the new post of director of sales, direct retail. Sher, who starts at Harlequin today, most recently had been senior v-p for marketing and merchandising at Sher Distributing. She will be based in the New York metro area and will oversee Harlequin's sales efforts through bookstores and jobbers.