Sales jumped and profits soared at HarperCollins in the quarter ended December 31, 2020, over the comparable period in the prior year. HC parent company News Corp reported that HC revenue increased 23% in the quarter, to $544 million, and EBIDTA (earnings before interest, taxes, depreciation, and amortization) rose 65%, to $104 million.
In a conference call discussing results, News Corp CFO Susan Panuccio said HC's second period results marked "the best quarterly performance in its history.” The sales increase was driven by strong backlist and digital sales, Panuccio said. E-book sales continued to rebound, with sales up 21% over the second quarter last year, and digital audio rose 10%.
Combined digital audio and e-book sales rose 15% over the second quarter of fiscal 2020. Robert Thomson, News Corp CEO, highlighted growing sales of digital audiobooks, which he said is a “relatively new” business under Brian Murray and one that financial analysts may not fully appreciate.
Overall, online sales were strong, with higher orders from Amazon and other e-tailers, Panuccio said. HC also benefited from higher consumption of books, she added. News Corp said all book categories had solid gains in the quarter, pointing to Didn’t See That Coming by Rachel Hollis, The Happy in a Hurry Cookbook by Steve Doocy, The Greatest Secret by Rhonda Byrne, and Code Name Bananas by David Walliams.
A final factor in the sales boost in the quarter was the publisher's acquisition, this spring, of three European children's publishing operations that were owned by Danish publisher Egmont. The acquisition added $13 million to second quarter revenue at HC.
For the first half of fiscal 2021, profits rose 56% over the comparable period in fiscal 2020, to $175 million, on an 18% increase in revenue, to $1 billion.
Panuccio said that, while forecasting future results remains challenging because of the pandemic, trends in the book business remain favorable. She added, however, that News Corp will continue to monitor consumer book-buying patterns, and said HC could face tough comparisons in the second half of the calendar year, particularly the fourth quarter.
