You are viewing your 1 free article this month. Login to read more articles.
Penguin Random House owner Bertelsmann has reported “strong growth” for the first nine months of 2021, in a trading report released days after the Department of Justice sued to block its acquisition of Simon & Schuster.
Revenues at the company were up 9.2% year on year to €13.1bn (£11bn), from €12bn (£10.2bn). The group said it also improved its operating margin. Organic growth amounted to 14.2% year on year and 8.4% compared to the pre-coronavirus year of 2019. The company now predicts a net profit of €2bn (£1.7bn) for the full year.
Penguin Random House (PRH) made “a particularly strong contribution”, the report said. Figures were not broken out for PRH but the firm singled out a series of New York Times bestsellers, including books by Amanda Gorman, The President’s Daughter by Bill Clinton and James Patterson, Harlem Shuffle by Colson Whitehead (published in the UK by Little, Brown), and How to Avoid a Climate Disaster by Bill Gates.
Thomas Rabe, chairman and c.e.o. of Bertelsmann, said: “The months from January to September 2021 went very well for us. Besides achieving strong organic growth, we made important strategic progress. For example, the number of paying subscribers to RTL Group’s streaming services grew rapidly to 3.4 million. BMG acquired an extensive portfolio of rights from Tina Turner. Our services subsidiary Majorel managed a successful IPO, and Bertelsmann strengthened its position in the Brazilian education market by acquiring shares in the education company Afya.“
Bertelsmann’s c.f.o. Rolf Hellermann commented: “Given our encouraging business performance in the past nine months, we remain very optimistic for the full-year 2021. We will see higher revenues and now expect a strong increase in operating EBITDA on a like-for-like basis, and net profit of close to €2bn.”
The announcement comes after PRH vowed to “vigorously” fight a lawsuit brought by the US Department of Justice seeking to block Bertelsmann's $2.2bn deal for Simon & Schuster.
On 2nd November, the Department of Justice filed a civil anti-trust lawsuit in the United States District Court for the District of Columbia, claiming the deal to buy S&S from owner ViacomCBS would enable PRH to “exert outsized influence over which books are published in the United States and how much authors are paid for their work”. The firms have called the suit “wrong on the facts, the law, and public policy”.