Lighter release schedule hampers Hachette UK in third quarter

Hachette UK’s revenues were down 6.7% in the third quarter of 2018, due to a lighter release schedule and decline in sales in its education segment, its parent company Lagardere has reported. The fall in sales in the UK has been attributed "mainly" to an absence of curriculum reform, which also affected France and Spain’s performance.

David Shelley, Hachette UK’s c.e.o., conceded overall the third quarter had "fewer major releases for HUK", but pointed to "some unexpected bestsellers and strong backlist and e-book sales". He also said Hodder Education’s results "tracked the market, which was muted in September due to distance from the last curriculum change".

The dip is comparably better than it was in the third quarter of 2017, when sales dropped 13.5% following the success of Harry Potter and the Cursed Child (Little, Brown) the previous year. It also follows a "standout" first half of 2018, reported in July, when sales were said to be "considerably up" year-on-year with Nielsen BookScan then showing a TCM lift in the first-half of 3.1% (£83.9m).

Of the publisher's performance in third quarter 2018, Shelley commented that digital publisher Bookouture had enjoyed "a very good summer with sales in the UK up year on year and significant growth coming from the UK and Australia" while John Murray Press enjoyed its second best ever month in August.

Particular titles highlighted for other divisions included Deliciously Ella: The Plant-based Cookbook by Ella Woodward, a "major success" for Hodder & Stoughton, as well as the film tie-in of Sarah Waters’ Little Stranger, together with Val McDermid’s Broken Ground, The Guilty Feminist by Deborah Frances-White and Robert Galbraith’s new Cormoran Strike novel Lethal White, which were all singled out as notable bestsellers for Little, Brown during the period. Hans Rosling’s Factfulness (Sceptre) and Ben Brooks’ Stories for Boys Who Dare to be Different (Quercus) also continued to "backlist strongly".

Looking forward, Shelley said the fourth quarter had "started extremely strongly for the whole UK group". Number one bestsellers remarked on were Brief Answers to the Big Questions by Stephen Hawking (John Murray), In a House of Lies by Ian Rankin (Orion) and Listening to the Animals: Becoming the Supervet (Trapeze) by Noel Fitzpatrick.

Third-quarter revenue for Lagardere Publishing overall totalled €607m, down 6.3% like-for-like and down 6.1% on a consolidated basis. Sales fell in France (down 14.7%), chiefly due to the absence of curriculum reform compared to third-quarter 2017, and in Spain/ Latin America (down 8.2%), owing to an unfavourable comparison effect in the education business after a less extensive textbook campaign in 2018. Sales were broadly flat for its Partworks business (down 0.4%).

In contrast, the US delivered “a sparkling performance”, Lagardere described, with growth of 5.1%. This was attributed to the continued success of its Perseus backlist, a strong release schedule at Grand Central Publishing, including Sally Field’s In Pieces, as well as the success of Bill Clinton and James Patterson’s novel The President is Missing (published by Cornerstone in the UK), especially in e-book and digital audio.

E-books and audio accounted for a greater proportion of sales in the quarter compared to the year before: e-books accounted for 7.7% of total Lagardère Publishing revenue in third-quarter 2018, versus 7.2% in the same period in 2017. Digital audio books represented 2.8% of revenue versus 1.8% in the third quarter of 2017.

All in all, group revenue for Lagardere came in at €1,895m (third quarter 2017: €1,858m), representing an increase of 2.6% like-for-like and of 2% on a consolidated basis.