Given the severity of the recession last year, the five largest trade houses in the U.S. fared fairly well as a group. With three of the five publishers owned by foreign companies, year-to-year comparisons can be imprecise because of currency fluctuations, but estimated total revenue generated in America fell less than 1% in the year, to $4.57 billion. Worldwide, revenue fell at HarperCollins and Simon & Schuster, rose at Penguin Group and Hachette, and stayed flat at Random House. And because the U.S. represents a significant portion of all five publishers' revenue, the financial performance in the U.S. mirrored that of their global results.
With its second consecutive year of solid gains, U.S. revenue at Hachette Book Group USA surpassed that of Simon & Schuster in the U.S., with HBG posting estimated sales of $740 million in the U.S. in 2009. Although S&S's total revenue remained ahead of HBG's estimated North American sales of $775 million last year, the 7.4% decline in sales in 2009 came entirely in S&S's domestic operations, dropping American sales to about $663 million last year. With its overseas operations stabilized, international revenue accounted for 16.5% of S&S total sales last year. S&S is off to a similar start in 2010, with international sales, led by the U.K. and Australia, up 13% in the first quarter, while sales in its domestic print operations fell (see Scorecard, p. 8). S&S CEO Carolyn Reidy said she expects business to improve over the course of the year as retail firms up and S&S releases more big books.
If S&S is indeed able to improve its domestic operations, the challenge for HBG will be to hold on to fourth place without benefit of another phenomenal year from Stephenie Meyer, although the bestselling author will still make her contributions. An original work, The Short Second Life of Bree Tanner: An Eclipse Novella will go on sale June 15 with a 1.5 million–copy first printing, and the film version of Eclipse will be released June 30.
The other publisher that had a down 2009, HarperCollins, appears to be on the rebound. Harper had a particularly poor first half of 2009, when total revenue fell 20%, but recovered some ground in the second half of the year with an 11% increase. (Harper officially reports on a year ending June 30 basis, but results have been restated for comparison purposes.) Harper is off to a good start in calendar 2010, with sales up 13.6%.
Despite the difficult operating environment last year, all of the largest houses remained profitable, although the recession did take its toll. Earnings fell at Penguin, S&S, and Harper and remained flat at Random. Hachette, unsurprisingly, had the best profit improvement last year, with global earnings rising 23.5%, to 304 million euros, giving the publisher a 13.3% operating margin.
