Hachette UK saw overall sales fall by 6.7% in the fourth quarter of the year due to lower e-book sales, with its parent company Lagardere Publishing saying that "market trends have reversed in the US and the UK".
Lagardère Publishing has released its fourth quarter and full year results, revealing that Hachette UK saw sales drop 6.7% year-on-year in the fourth quarter, attributed to the decline in e-book sales. The company said changes to VAT on 1st January 2015 were responsible for the drop, along with a “slower release schedule” than the fourth quarter 2014.
Overall for the fourth quarter, Lagardère Publishing's sales were up 9.2% like-for-like to €631m and up 17.5% on a reported basis.
For the full year, Lagardere said the UK arm was in a “slowdown” of minus 3.3%, also due to the decrease in e-book sales. “Good performances of education and illustrated books did not offset a slower release schedule than 2014 in non-fiction,” the company said.
Full year results for Lagadere Publishing were much better, however, with sales at €2,206m, up 1.7% on a like-for-like basis and up 10.1% on a reported basis.
A note in the Lagadere release said: “In 2015 market trends have been reversed in the US and the UK, with a rebound in volumes of printed books to the detriment of e-books, due to new contracts terms with Amazon. For the time being this digital transition remains essentially confined to the English-speaking markets and only in the general literature segment, which represents about 40% of total sales of the division. In the UK, Lagardere Publishing digital sales represent 26% of Adult Trade compared to 31% in 2014."
By comparison, Spain and Latin America posted "an excellent performance" in the fourth quarter, up 19% - "thanks to Asterix". Sales in both France and the US rose 15.2%, with increases attributed to the "very good performance" of illustrated books and general fiction in France and "a favourable publishing calendar during the quarter" in the US, in spite of a "slight decline" for US e-book sales, too.
Tim Hely Hutchinson, c.e.o. for Hachette, acknowledged e-book sales had "slowed", "after six years of stratospheric growth". However, he emphasised: "We estimate that we remain the number one publisher in e-books and that, in the year, Hachette UK’s estimated market share rose by 1% to 22% of the e-book market. Digital sales now represent over 20% of HUK’s total sales."
Despite the sales dip, Hely Hutchinson hailed 2015 "another standout year for the Hachette UK group".
"The six companies we acquired in 2014 and 2015 made significant contributions to the group, each bringing new specialisms and areas of expertise resulting in spectacular sales," he said.
In its first full year as part of Hachette UK, Quercus and its imprints recorded the largest year-on-year growth of any major British publisher, according to Hachette; Nielsen Bookscan showed 2015 sales went up 29.6% in volume and up 44% in value.
Hachette UK's growth has been propelled by sales of key titles The Girl in the Spider’s Web, Look Who’s Back, surprise Christmas-hit Norwegian Wood (all MacLehose Press), and Deliciously Ella (Yellow Kite), and debuts including I Let You Go by Clare Mackintosh (Sphere) and Costa First Novel winner The Loney by Andrew Michael Hurley (John Murray), Hachette said.
The company acquired Rising Stars in January 2015, which made a "major contribution" to the success of Hodder Education, particularly in areas of (primary) science, computing and assessment, according to Hachette. The company grew market share from 19% in 2014 to 22.5% in 2015, making it the third largest educational publisher in the UK, Hachette said.
Octopus also had a "spectacular year" according to Hely Hutchinson, "due to the explosion in sales of colouring books and brilliant publishing of cookery books".
Overall sales for Lagardère were €2.04bn, up from €1.90bn a year ago, up 7.4% on a reported basis and up 3.5% on a like for like basis.