Hachette UK had 'good 2017' but sales dipped 3.9%

Hachette UK had "a good 2017" despite like-for-like sales dipping 3.9% after an unfavourable comparison to the year before, when it achieved bumper sales from J K Rowling’s Fantastic Beasts and Where to Find Them and the restocking of Harry Potter and the Cursed Child.

Chief executive David Shelley said Hachette UK beat its sales and profit budgets, but owing to its record-breaking 2016 - when sales grew 11% - the comparison was “unfavourable”.

“All divisions made a healthy contribution to the year”, he said, highlighting bestsellers from authors including John Grisham, Stephen King, Val McDermid, Clare Mackintosh, Martina Cole and Michael Connelly. Debut novels to perform strongly throughout the year included The Dry by Jane Harper (Little, Brown)) and Ruth Hogan’s The Keeper of Lost Things (Two Roads) and Christmas bestsellers including Bletchley Park’s Brain Teasers (Headline), Gino’s Italian Coastal Escape (Hodder), Keep Calm and Colour Unicorns (Summersdale), How to be Champion by Sarah Millican (Orion), Fever Tree: the Art of Mixing (Mitchell Beazley) and the first TV tie-ins featuring Cormeran Stike from Robert Galbraith (Sphere).

Hodder Education had “another excellent year” and claims to be “the second largest and fastest-growing educational publisher both in the UK and the overseas markets where it operates”. Shelley said the division now publishes nearly one in four of all books in schools in the UK and had increased its market share by 1% to a record 24%.

Furthermore, Hachette‘s e-book publishing was “considerably enhanced” by the acquisition of Bookouture, Shelley said. He divulged it had a “record-breaking” year in 2017, while 30% growth in audio year-on-year had also made a “significant contribution” to its results. 

Overall for Lagardère Publishing, revenue for 2017 came in at €2,289m, up 1.9% like-for-like (up 1.1% on a consolidated basis) and, at 9.2%, operating margin was stable, with recurring EBIT at €210m, representing an increase of €2m on 2016. 

According to Lagardère the increase in its profits was mainly down to a strong performance in the United States, delivering 2.7% sales growth, underpinned by successful releases as well as continued profitability gains as a result of an ongoing cost-cutting plan. 

Business growth also came from Partworks, which grew its sales by 8.8%, particularly in Argentina and Japan, and from France, up 3.4%, driven by the success of such bestsellers as Astérix et la Transitalique and Dan Brown’s Origin, a record year for Le Livre de Poche paperbacks and the success of textbook publishers amid curricular reform. Sales in the Spain and Latin America region were down 5.2%, mainly owing to an unfavourable comparison with 2016 when there had been curricular reform. In 2017, the contribution of e-books to Lagardère Publishing's overall revenue was 7.9% (8% in 2016).

In the fourth quarter of 2017 Hachette UK made three acquisitions - Kyle Books, Summersdale and Jessica Kingsley Publishers - whose “innovative and distinguished lists” Shelley praised. He also welcomed the “talented new colleagues” they had brought to the company.

Looking forward, in Tim Hely Hutchinson’s honour, Hachette UK’s new distribution centre has been named The Hely Hutchinson Centre. Built and fitted out with state-of-the-art systems, according to Shelley it is now “nearing completion ... ready for the first publisher to move in the summer".