Citing strong revenue and profit growth in the U.S. and U.K., sales at Penguin Random House increased 4.6% in 2020 over 2019, to €3.8 billion, or $4.46 billion at current exchange rates, while operating EBITDA (earnings before interest, taxes, depreciation and amortization) jumped 23.3%, to €691 million.
According to parent company Bertelsmann, PRH benefited from higher sales of e-books and digital audiobooks as well as from higher online sales. The publisher's top-selling book was Barack Obama’s A Promised Land, which sold more than 7.3 million copies worldwide across all formats. PRH publishers, Bertelsmann said, “expanded its online sales in numerous markets,” while audiobook sales grew by double digits in “most markets.”
Unlike some years, in which the publisher's acquisitions drove sales numbers, in 2020 organic growth was up 6.7%, helping to offset the negative effects of foreign currency exchange. Revenue from PRH’s distribution business rose 7% over 2019, to €104 million. During the year, Bertelsmann acquired Pearson's remaining 25% stake in PRH, granting it full ownership of the company.
Bertelsmann didn’t have much to say specifically about the U.S. market, other than noting that PRH’s overall revenue gain “was due in particular to positive business performance” in its U.S. business. PRH US accounted for just over 58% of PRH’s total revenue, or €2.20 billion, roughly $2.59 billion. In 2019, the U.S. represented 56% of PRH revenue, which is about $2.2 billion.
Addressing the pending acquisition of Simon & Schuster, Bertelsmann's main comment was that it is “optimistic" it will receive all approvals required from competition regulators later this year for the purchase to be completed.
PRH worldwide CEO Markus Dohle never mentioned S&S in his letter to employees, though he alluded to the acquisition. “Driven by content, enabled by reach, our ambition is to grow in 2021,” he wrote, adding that, in the year, “we will continue to support our imprints’ distinct identities and cultures.”
As for strategic initiatives, Dohle said, “we will align our reach capabilities and resources in sales, marketing, and publicity even more with a marketplace increasingly dependent on the online, e-commerce, and digital channels. Online optimization will help us grow our backlist sales significantly.” Dohle added that PRH will continue to invest in its supply chain, promising that the company “will steadfastly remain a loyal and reliable partner to physical bookstores.”
Pointing to the pandemic and social justice movements that marked most of the last year, Dohle thanked employees for their commitment in a difficult time. He pledged that, in 2021, PRH “will do our part to build a more equitable and just world through the power of books and reading.”
