Earnings dropped 28% at HarperCollins in the first quarter of fiscal 2020 compared to the first period of fiscal 2019, while revenue declined 3%. According to parent company News Corp., EBITDA (earnings before interest, taxes, depreciation, and amortization) fell to $49 million in the recent quarter, down from $68 million in the first quarter of fiscal 2019, and revenue declined to $405 million, from $418 million.
News Corp attributed the decline to difficult comparisons to last year’s first quarter, when titles like Girl, Wash Your Face by Rachel Hollis, The Hate U Give by Angie Thomas, and The Subtle Art of Not Giving a F*ck by Mark Manson were strong sellers. In addition, foreign currency changes lowered sales by $5 million. News reported that digital sales declined at a more rapid rate than total revenues, falling 5% in the quarter compared to a year ago. The company did not separate the performance of e-books and digital audiobooks. Digital revenue represented about 22% of consumer sales in the quarter.
In a conference call discussing first quarter results, CFO Susan Panuccio said that while HC has some strong new titles this quarter—such as a new Ree Drummond cookbook—the publisher still faces difficult comparisons to last year’s second quarter, when Joanna Gaines's Homebody was a huge bestseller and HC’s backlist did very well. “Given the timing of the release schedule,” Panuccio told analysts, “we expect performance will be more second half weighted.”
