Changing of the guard?

For what seems like since time immemorial, Penguin Random House Children's has been by far the biggest beast in British kids' publishing. That might have changed this morning with HarperCollins' announcement that it will acquire Egmont UK, plus Egmont’s Polish and German children’s book publishing divisions.

(An aside, this did get me wondering whether the particulars were finally agreed after remote working began, perhaps over a Zoom meeting where someone inadvertently turned themselves into a potato?) 

In pure sales through the tills terms, this means there just might be a new sheriff in town. Last year, HarperCollins Children’s Books and Egmont combined to sell £58.6m through Nielsen BookScan, PRH Children’s £57.1m. Now, due to the vicissitudes of publishing schedules there are ups and downs every year through the TCM but going by, as they say in football (remember football? It used to be played most Saturdays), on current form it would be hard to think that HCCB/Egmont would not solidify or add to that lead come year’s end—or, rather by the end of 2021 when the market perhaps returns to normalcy.

HCCB has been in its best run in its history, chalking up three consecutive record years of £40m+ in TCM revenue, earning £45.1m in 2019 and winning the British Book Award for Children’s Publisher of the Year in three of the last six years. Yes, this has a whole lot to do with David Walliams—he earned 43% of HCCB’s revenue last year. But having a hugely successful author is hardly much of a cross for a list to bear and even when they leave, if the publishing program is managed well, the money can roll in for years to come: £9.4m, or 55%, of Bloomsbury children's TCM revenue in 2019 was generated by J K Rowling, for example. PRH Children's has had slightly contrasting fortunes of late, with its TCM market share shrinking to under 15% for the last two years—the first time that has happened in its history.

HCCB's now junior partner Egmont has had a bit rough time of it lately, however. In 2019, it recorded its lowest TCM earning this decade (£14m overall, £13.6m of which was children's) - and has started 2020 off with revenues in line with 2019.  

Of course, we should note that this is TCM revenue only, and what a children's publisher earns only begins with domestic bookshops sales. PRH is clearly the UK leader in rights revenue and has an enviable 80-year backlist with arguably unmatched legacy brands (Roald Dahl, Beatrix Potter, Spot the Dog and on and on), as well as licensed properties like Peppa Pig.      

But the bottom line is that the UK children's publshing league table has shfited dramatically today. Rather than being the clear market leader, PRH will now have to contend with a strengthened, emboldened and enriched rival. For the UK kids' sector, it is a day as seismic as when Penguin and Random House announced their merger eight years ago.