Quarto Group, which endured turmoil in its upper management ranks for a good portion of the first half of 2018, is undergoing more change in the second part of 2018 as the company initiates a round of cost-cutting in both the U.S. and U.K. As part of the cost-cutting, the company will be closing its Minneapolis office.
During the first half of 2018, former chairman Laurence Orbach returned to head the company. Orbach then left a few months after his return, and chief executive Marcus Leaver resigned in May. With CK Lau now heading the publisher as chief executive, Quarto said it has begun a cost-cutting program designed to right-size the company and allow it to “focus on its core strengths.”
Although Quarto didn’t supply too many details, a spokesperson did confirm that the company is shuttering its Minneapolis office, which is home to its Voyageur Press, Cool Springs, and Motorbooks imprints. The spokesperson said Cool Spring, Burgess Lea, and Motorbooks will continue, while Voyageur will not. The existing Minneapolis location will close at the end of the year
It was not clear how many employees will be affected by the cuts that, which are aimed at trimming payroll and occupancy costs. Quarto also plans to cut its pre-publication expenditures. Quarto said that, because it would need to take one-time charges to account for the reduction program, it doesn’t expect to see actual savings until 2019.
From an operating standpoint, though, Quarto had some good news. The company reported that revenue in the U.S. rose 9%, to $34.7 million, in the first six months of 2018 over 2017. The rise was led by Quarto's Quarry and Fair Winds Press imprints. Revenue was also up at its Racepoint Publishing and becker&mayer units.The U.S. business also benefited from growth in its specialty retailer network, which helped to offset lower sales in the book trade.
For the entire company, Quarto Group reported that revenue for the first half of the year rose 12% over the first six months of 2017, hitting $56.2 million. The company's operating loss was cut to $7.0 million from $7.6 million a year ago.
Editor's note: This story has been updated with new information about Quarto's plans for the Minneapolis facility.
