Revenue at Lagardère's Hachette Livre, parent company of Hachette Book Group, slipped 0.4% last year, to €2.37 billion, from €2.38 billion in 2019. Earnings, however, rose 11.8%, to €246 million. Revenue gains in the U.S. (up 3.9%) and the U.K. (ahead 9.9%) offset declines in France (down 4.3%) and Spain/Latin America (off 16.4%). The increase in profitability was due to higher sale of digital formats, strong backlist sales, and cost reductions, Lagardère said.
In the U.S., HBG CEO Michael Pietsch said that sales gains were led by Stephenie Meyer’s huge bestseller, Midnight Sun, as well as a number of titles connected to Black Lives Matter, including Jason Reynolds and Ibram X. Kendi’s Stamped: Racism, Antiracism and You, Ijeoma Oluo’s So You Want to Talk About Race and Beverly Tatum’s Why Are All the Black Kids Sitting Together in the Cafeteria? The Witcher series, by Andrzej Sapkowski, also was a strong performer last year, Pietsch said.
HBG also benefited from higher sales of e-books and downloadable audiobooks, as well as the acquisition of 1,000 children’s titles from Disney Publishing Group early in the year. Backlist sales were also strong in the year, Pietsch said.
HBG accounted for 29% of Lagardère's publishing revenue, or €689 million—about $839 million at current exchange rates—compared to €667 million in 2019. On a global basis, Lagardère said e-book sales rose 22% in the year and now account for 9.5% of publishing revenue, while digital audio sales jumped 25% and accounted for 4.3% of sales.
The company had a cautious outlook for its book publishing business's prospects for 2021. Lagardère said that it expects reading, and book buying, to face more competition in the year as more restaurants, movies, and other event venues reopen as the pandemic eases. The company also said that if more customers return to bookstores, demand for digital formats could lessen—something that could slightly hurt profits.
An easing of the pandemic will be a huge shot in the arm for Lagardère's other major business, travel. Travel revenue fell 60% in 2020, and the division had a loss of €353 million. The company, however, predicts only modest improvement in the travel industry for 2021, and indicated that its focus in the year will once again be on controlling costs.
