Revenue at Lagardère Publishing was €2.75 billion ($2.94 billion) in 2022, up 5.8% over 2021, but earnings fell 14%, to €302 million. The company attributed the increase to acquisitions, including a full year of sales from Workman Publishing (which was acquired by Hachette Book Group in September 2021), as well as to a €87 million gain from currency changes. Excluding one-time charges, sales were down 1.9%.
Inflationary pressures raised the costs on all areas of production, as well as on freight and personnel expenses, Lagardère said, impacting earnings. Those costs were offset to some degree by price increase and cost controls. The publishing group finished the year with an operating margin of 11.0%, which, the company noted, was nearly 2 percentage points higher than the pre-Covid high recorded in 2019.
HBG’s financial performance mirrored that of the larger publishing group. CEO Michael Pietsch said total sales were up over 2021 because of the Workman purchase and “were down slightly” from the peak of 2021, excluding Workman results. Profits fell because of “sharply rising manufacturing and freight costs,” Pietsch said.
The sales gain was led by “especially strong sales for Verity by Colleen Hoover, Run, Rose, Run by Dolly Parton and James Patterson, and the Witcher series by Andrzej Sapkowski,” Pietsch said. HBG’s audio and distribution businesses, also had a good year. Backlist sales were down from 2021 and so too were hardcover sales.
Among the titles that Pietsch believes will do well in the first half of this coming year are David Baldacci’s Simply Lies, Laura Dern and Diane Ladd’s Honey, Baby, Mine, Elin Hilderbrand’s The Five-Star Weekend, T.D. Jakes Disruptive Thinking, and James Patterson’s Cross Down.
In Lagardère’s other publishing areas, revenue in France fell 5.8% in a declining market. Sales rose 3.4% in the U.K and increased 7.2% in Spain/Latin America.
Digital audiobooks increased their share of total Lagardère’s revenue to 4.3%, from 3.8% in 2021. E-books accounted for 7.8% of the division’s total revenue, versus 7.7% in 2021. Looking at 2023, Lagardère representatives said that despite cost pressures, the company expects its publishing group to “maintain similar performances to 2022.”
Book publishing is one of the two major operating divisions for Lagardère. Its travel division had been hammered during the pandemic, but had a 71.5% increase in revenue in last year, and posted a profit of €136 million compared to a loss of €81 million in 2021.
