Lagardère announces Q1 2020 results
Paris-April 30, 2020
Lagardère announced results for First Quarter 2020 today. Highlights of the company’s financial performance are as follows:
At Hachette Book Group:
CEO Michael Pietsch said, “We started the year strongly, with revenues and profits solidly up over 2019. Major publications in the quarter included James Patterson’s #1 bestseller Blindside, Harlan Coben’s #1 bestseller The Boy from the Woods, Douglas Preston & Lincoln Child’s Crooked River, Dr. Mark Hyman’s Food Fix, and Anne Glenconner’s Lady in Waiting, plus four #1 bestsellers from Little, Brown Books for Young Readers: Stamped by Jason Reynolds and Ibram Kendi, A Tale of Magic by Chris Colfer, Little Legends: Exceptional Men in Black History by Vashti Harrison, and Code Name Verity by Elizabeth Wein. Andrzej Sapkowski’s Witcher series continued its long run, helping the Orbit imprint achieve #1 market share in Science Fiction and Fantasy for the quarter. And the downloadable audio format continued its growth trajectory, led by Malcolm Gladwell’s Talking to Strangers.
“We continued growing with the acquisition of Disney Book Group titles, adding a rich catalog of over 1,000 backlist and 40 forthcoming books to Little, Brown Books for Young Readers. And we took on a new third-party distribution client, National Geographic, which goes live October 1.
“As the first quarter closed, we entered a world completely changed by COVID 19. We are grateful for the partnership and close connection with our employees, booksellers, authors, librarians, and everyone in the community of publishing that is helping us to move forward resolutely and hopefully through these extreme circumstances.”
At Hachette Livre:
Hachette Livre delivered revenue of €457M, down 0.8% on a consolidated basis (down 3.3% like for like). The difference between consolidated and like-for-like revenue is attributable to a positive foreign exchange effect and acquisitions of Gigamic and Short Books in 2019. The figures below are like-for-like:
- In France: Q1 2020 revenues were down 9.4% due to confinement measures introduced by the French government in March amid the COVID-19 crisis. Distribution activities were also disrupted, with digital sales failing to offset the sales downturn at brick-and-mortar stores.
- In the US: “the significant 6.8% increase in business was led by the success of Andrzej Sapkowski’s The Witcher series (both print and e-book formats) and by the sharp rise in downloadable audiobooks fueled by the success of Malcolm Gladwell’s Talking to Strangers and The Witcher series,” according to Lagardère’s press release. Ebooks accounted for 16.8% of total US revenue in Q1 2020 versus 17.4% in Q1 2019. Downloadable audiobooks as a percentage of total US revenue increased by almost 4.5 percentage points, to 14.4% in Q1 2020 from 10.0% prior year.
- In the UK: Revenue in the UK “contracted 5.5% owing to a more subdued literary release schedule, although this was partly countered by the success in all formats of The Witcher series at Orion.” Ebooks accounted for 17.8% of total UK revenue in Q1 2020 compared to 16.8% in Q1 2019, while downloadable audiobooks accounted for 6.2% compared to 3.8% in Q1 2019.
- In Spain/Latin America: Revenue in the Spain/Latin America region fell 2.3%, as March figures were affected by the state of emergency and confinement measures introduced in Spain. Mexico saw slight growth.
- Partworks: Partworks dropped 6.1%, with fewer launches in the quarter, a strong performance in the comparative Q1 2019 period, and the impacts of the health crisis in March, which primarily affected sales at newsstands, especially in France.
- Ebooks: accounted for 9.7% of total Lagardère Publishing revenue in the Q1 2020, compared to 9.1% in Q1 2019, while downloadable audiobooks represented 5.9% of revenue compared to 3.8% in Q1 2019.
The Lagardère group reported revenue of €1.361 billion in the first quarter, down 12.5% like for like and down 10.4% consolidated versus Q1 2019. Revenue fell 12.5% in first-quarter 2020, “mainly as a result of the impacts of the Covid-19 crisis on Lagardère Travel Retail’s operations from mid-February, and despite a good performance at Lagardère Publishing for the first two months of the quarter.” The difference between consolidated and like-for-like revenue reflects a positive foreign exchange effect, and acquisition and divestment activity as part of the Lagardère group’s strategic refocusing.
Read Lagardère’s press release for further details, including a detailed COVID-19: Outlook and Liquidity summary. Lagardère’s next financial report will be first-half 2020 results on July 30, 2020.