Hachette Reports Revenues Up, eBook Revenues Down in Third Quarter
Lagardère released its third-quarter financial report on Thursday. The data on Lagardère Publishing, which includes Hachette, was less than specific as to ebook sales but if we crunch the provided numbers then they reveal that ebook sales continue to decline.
You can find the quarterly report here (PDF), and here are the slides to the investor presentation (PDF).
Here’s what the report said about the publishing division:
At €675 million, the business posted substantial growth on a like-for-like basis, up 10.9% (up 11.2% on a consolidated basis). The difference between these two changes is mainly due to a positive scope effect (+€26 million) offsetting a negative foreign exchange effect (-€24 million). The figures below are presented on a like-for-like basis.
In France (up 7.8%), the high level of activity was mostly driven by curricular reform (primarily secondary school level) and by the growth of Illustrated Books, thanks to the success of the different editions of Simplissime by Jean-François Mallet. This performance has been achieved despite an unfavourable comparison effect in General Literature, due to a less unreached release schedule.
In the United States, activity is up significantly (by 12.9%), thanks to the positive impact of a stronger release schedule, with the success of Two by Two by Nicholas Sparks and A Woman of God by James Patterson.
In the United Kingdom, business climbed substantially (up 30.1%), driven partly by the successful release of Harry Potter and the Cursed Child and partly by the solid performance of Education, especially at the secondary school level.
Business fell in the Spanish/Latin American region (down 8.4%), due to early orders for the school books season in the first half of this year.
Partworks’ performance was stable (up 0.4%).
In the third quarter, e-books accounted for 6.8% of total Lagardère Publishing revenue, compared to 7.9% in the third quarter of 2015.
Crunching the quarterly revenue and the percentages in the last paragraph informs us that Hachette earned 45.9 million euros in ebook revenue last quarter, down from 47.51 million euros in the same period last year.
Edit: These figures are given in euros, not dollars. My error.
That is a 1% decline.
Given that Hachette brought back agency pricing in order to kill ebook sales, such a small decline indicates that Hachette is failing in its objective.
Clearly they will have to raise prices again.
image by ActuaLitté
Comments
Edward Bear November 10, 2016 um 1:59 pm
Hachette also forgets one other thing. Even though higher prices discourage sales they do nothing to prevent acquisitions made through unofficial channels. In fact, they actually encourage them since, with eBooks, the low production cost is well known and higher prices transmit to the customer as "ripoff."
Chris November 10, 2016 um 2:40 pm
Is there a simple explanation anywhere of why Hachette (et al?) are trying to "kill ebook sales"?
Nate Hoffelder November 10, 2016 um 4:03 pm
The consensus is that the Big Five were killing ebook sales in favor of print sales.
Thomas November 11, 2016 um 10:33 am
I get the impression that they discourage e-book sales mostly to keep their print distributors and retailers happy. They still sell a lot of books through Walmarts, grocery stores, etc.
Smart Debut Author November 10, 2016 um 5:05 pm
I don’t think Hachette et al are trying to fully kill all ebook sales — ebooks are the most profitable format for any publisher.
In fact, without the ebooks providing 20-25% of their revenues and a far higher percentage of their profits, there is not one of the Big Five that could even come close to breaking even today.
However, they damn sure want to prevent those profitable ebook sales from growing any further and causing the collapse of print sales, the closure of physical bookstores, and the like.
Because if they did, the Big Five would find they have zero value to offer authors, who can do all the digital stuff just as well — or better — on their own.
The collapse of paper books will be the end of traditional publishers, who will at that point be totally superfluous.
That’s what they are fighting.
They are giving up short term profits to try to hold off an existential threat.
Paul Biba’s eBook, eLibrary, eMuseum and ePublishing news compilation for week ending Saturday, November 12 | The Digital Reader November 12, 2016 um 4:53 pm
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