Acquisitions and good performances in all countries where it operates led to a 9.4% increase in revenue at Lagardère Publishing in 2021, while earnings jumped 42.7%, according to parent company Lagardère.
Revenue was €2.6 billion ($2.9 billion at current exchange rates), and recurring EBIT (earnings before interest and taxes) was €351 million (almost $400 million). Excluding one-time items, including €24 million ($27 million) from the purchase of Workman Publishing, sales rose 8.1%. Sales and profits were both records, Lagardère said.
Sales grew fastest in France, up 13.8%, driven by gains in general literature and illustrated books.
In the U.S., sales at Hachette Book Group rose 3.7%, excluding the contribution for Workman. HBG CEO Michael Pietsch said that the improvement in sales and profits was led by “outstanding performances from all our publishing groups,” with the publisher seeing good sales growth at the chains, independent bookstores, and gift stores as well as at its international accounts.
Pietsch added that “results were boosted by high sell-through, a significant increase in hardcover sales in our adult divisions, exciting growth for Running Press’s Minis program, and an excellent year for our [distribution] business." The U.S. and Canada accounted for 28% of Lagardère's sales, down from 29% in 2020.
In the U.K., sales increased 2.5%, driven by frontlist and backlist momentum in children’s and adult titles. In Spain/Latin America, revenue grew by 5% thanks to brisk momentum in Spain—especially in the trade segment, Lagardère reported.
The earnings growth was led by the overall sales growth, favorable product mix, and “disciplined cost containment,” Lagardère said, adding that the 13.5% operating margin was a record.
The company's financial outlook for 2022 is cautious, with Lagardère expecting revenue—even with the addition of Workman—to be flat in the year. The company based the forecast on its belief that as lockdowns ease, people will resume a variety of activities, which could cut into reading and book buying. The absence of education reform in France is another negative factor. Earnings are expected to decline from 2021 due to “less favorable market trends,” including “inflationary pressure on costs.” As a result, Lagardère expects its margin to fall to about 11%.
