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Lagardère First Half 2022 Results

Paris-July 27, 2022

At Hachette Book Group:
Hachette Book Group CEO Michael Pietsch said, “2022’s first half was solid, with revenues ahead of 2021 thanks to Workman joining us and a rise in trade paperback and downloadable audio sales, high backlist sales, strong sales in independent bookstores and in Canada, and continued growth in our third-party distribution business. Like for like, revenues were down very slightly due to a lighter release schedule.  Profits remain strong but below 2021’s extraordinary results due to sharply rising costs in paper, manufacturing, and shipping.

 Results were buoyed by the success of Dolly Parton and James Patterson’s Run, Rose, Runthe best-selling new hardcover of 2022, and continued strong demand for Colleen Hoover’s first suspense novel, Verity.  We’ve also had #1 bestsellers from David Baldacci, Kelly Barnhill, Harlan Coben, Vashti Harrison, Elin Hilderbrand, James Patterson, David Sedaris, Tom Segura, and Nicholas Sparks. And our books and authors have received significant honors this year, including the Los Angeles Times Book Prize for Dr. Chanda Prescod-Weinstein’s The Disordered Cosmos, James Beard Award for Melissa Martin’s Mosquito Supper Club, Barnes & Noble’s Children’s and YA Book Award for Christopher Denise’s Knight Owl, and Chautauqua Prize for Rebecca Donner’s All the Frequent Troubles of Our Days.

The second half is full of big, exciting new books including Kwame Alexander’s The Door of No Return, David Baldacci’s Long Shadows, W. Kamau Bell and Kate Schatz’s Do the Work!, Misty Copeland’s The Wind at My Back, Patricia Cornwell’s Livid, N.K. Jemisin’s The World We Make, Joel Osteen’s Your Greater Is Coming, James Patterson’s Triple Cross, Stacy Schiff’s The Revolutionary: Samuel Adams, and Rick Steves’ Barcelona.”

At Hachette Livre:
Lagardère Publishing delivered revenue of €1.216 billion, up 7.7% as reported and down 1.0% like for like. “The difference between reported and like-for-like figures results from a €59 million positive scope effect mainly due to the acquisition of Workman Publishing, a US publisher specializing in children and young adult titles and illustrated books, and of Paperblanks, the world number two in premium notebooks and stationery. The €39 million positive currency impact for the period was primarily linked to the appreciation of the US dollar (€29 million) and pound sterling (€9 million),” according to Lagardère’s press release.

The changes below for the first half are shown on a like for like basis:

 In France: revenue for the division was down 3.7%, “notably reflecting a fall in sales of General Literature and at Larousse, in a declining market. Revenue for Illustrated Books was up slightly, lifted by strong growth in the Tourism segment as travel resumed, as well as in Children and Young Adult, which was buoyed by the success of several titles such as Skandar and the Unicorn Thief by A.F. Steadman and Alice Oseman’s Heartstopper titles following the release of the Netflix series. Pika delivered a stellar performance in the manga segment, compensating for the remarkable success of the Attack on Titan series in 2021 with the launch of new series during the period.”

 In the US: revenue at Hachette Book Group dropped 1.9%, “mainly due to a lighter release schedule than in 2021, despite a number of successful titles in the first half of 2022, such as Run, Rose, Run, co-written by James Patterson and Dolly Parton at Little, Brown Adult, and Verity by Colleen Hoover at Grand Central Publishing.”

In the UK: revenue at Hachette UK rose 1.5%, “chiefly driven by Children and Young Adult, with the success of the Heartstopper titles, while the Adult Trade segment was lifted by the popularity of certain titles on social networks, such as Verity by Colleen Hoover and The Love Hypothesis by Ali Hazelwood at Little, Brown Book Group. After being hindered by the health restrictions in 2021, Education posted a good performance.”

In Spain/Latin America: revenue in Spain and Latin America grew 7.4%, “driven by a good performance in the Trade segment in Mexico, which had been hit hard by the health crisis in early 2021. In contrast, revenue in Spain was down due to a later start to the school campaign in 2022, which was not fully offset by momentum in the Trade segment.”

Partworks: revenue for Partworks rose slightly by 0.5%.

Ebooks: in the first half of 2022, digital audiobooks accounted for 4.5% of Lagardère Publishing’s total revenue (versus 4.2% in the first half of 2021). The share of ebooks dipped slightly, accounting for 7.6% of the division’s total revenue, versus 8.2% in first half 2021.

“Lagardère Publishing reported €81 million in recurring EBIT, down €29 million on its record-beating first-half 2021 performance. This decline was mainly attributable to inflationary pressures on production, transport and labor costs.”

 At Lagardère:
Revenue for the Lagardère group in the first half of 2022 totalled €3.027 billion, up 38.6% on a like-for-like basis and 45.8% on a reported basis. “The difference between reported and like-for-like revenue is essentially attributable to a €103 million favorable currency effect (of which €72 million linked to the US dollar, €10 million to the pound sterling and €9 million to the Chinese yuan). The €53 million positive scope effect was mainly due to the acquisitions of Workman Publishing and Paperblanks at Lagardère Publishing and of Dubai-based Creative Table Holdings Ltd at Lagardère Travel Retail.”

Group recurring EBIT in the first half of the year totalled €107 million, up sharply by €104 million compared to recurring EBIT of €3 million in first-half 2021. Lagardère Publishing recorded recurring EBIT of €81 million (€110 million in first-half 2021), and Lagardère Travel Retail reported recurring EBIT of €26 million (versus a negative €96 million in first-half 2021).

Read more in Lagardère’s press release. If you have questions about today’s announcement, please contact me.

Third-quarter 2022 revenue will be announced on Thursday, October 27.