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Lagardère Reports Publishing Revenues Up, eBook Revenues Down

22240992035_56f4b33075_hLagardère reported excellent growth  today in its publishing division in the first 9 months of its fiscal year.

Total revenues for the period for the US, UK, France, and other divisions totaled 1.58 billion euros, up 7.4% from last year (1.47 billion euros). Revenues for the quarter were also up 7.8% (564 million vs 604 million). Lagardère attributed the improvements to acquisitions of Quercus and Nicholas Brealey in the UK, and a positive foreign exchange effect.

The press release also mentions that there were "good sales performances in France (+2.1%) in General Literature and in Spain (+5.4%) in Education" in the nine month period, and a decline in revenues at Hachette US (-6.6%).

Hachette’s US revenues were also down 4.2% for the quarter, which means they had worst sales this year than during the nasty contract fight with Amazon last year.

Furthermore, the bad news extends to digital revenues. Lagardère’s ebook revenues declined in the third quarter of 2015 from 8.9% to 7.9%. That is an actual decline of around 2.2 million euros (50.2 million vs 48 million).

eBook revenues also declined in the first nine months of the year from 10.4% to 9.6%. Again, that is an actual decline of around 3.4 million euros (151.2 million vs 154.6 million).

Lagardère’s didn’t break out publishing or ebook revenues for specific countries, but they did note that the "digital transition remains limited to English-speaking countries and to the General Literature segment", meaning that Lagardère’s ebook sales in France, Spain, and other markets remain negligible.

  • in the United States, where the e-book market is declining (confirming the slowdown seen since 2014), e-books accounted for 24% of Trade(5) sales, versus 28% at the end of September 2014;
  • in the United Kingdom, where the e-book market has been broadly flat since the start of the year, e-books represented 30% of Adult Trade(6) sales versus 34% at end-September 2014, reflecting primarily the rise in VAT.

So basically we’re not buying as many ebooks from Hachette as we used to, or books for that matter (in the US, anyway). On the plus side, Lagardère is selling more paper books in other markets.

image by ActuaLitté

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fjtorres November 10, 2015 um 11:28 am

Don’t forget, by reporting in Euros they can take advantage of changing currency exchange rates. With the euro falling significantly against the dollar (well into double digit territory) declining gross sales in the US can be spun as growth in euros.
That 7% growth likely represents a solid 10% or higher decline in dollar sales.

Steve H November 10, 2015 um 1:34 pm

With the increased agency prices a small decrease in sales dollars translates to a large drop in sales units. Decreased market share…expect to hear that sales have improved for independents.

fjtorres November 10, 2015 um 8:17 pm

I checked the currency rates at Oanda and from Nov 11 2014 to nov 11 2015 the Dollar has appreciated 17% over the Euro (the pound has also appreciarted a similar amount) so if Hachette had stayed flat in US and UK sales they would be reporting a 17% boost in Euro revenue.
A mere 7% means a big drop in the US and probably the UK, too.

Gotta love those Agency deals.

Fbone November 10, 2015 um 8:37 pm

If you start from March, the dollar has weakened 5% against the Euro.

fjtorres November 11, 2015 um 6:35 am

They are reporting year over year numbers.
That’s why I went back to last november.
(But yes, the central bank is trying to prop up the Euro.)

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