Revenue drop at Pottermore 'in line with expectations'

Revenue drop at Pottermore 'in line with expectations'

Sales and profits fell at Harry Potter site Pottermore in the year to end March 2018. The dip in performance was said to be in line with expectations and reflected the dearth in new publications after the previous year's release of the Cursed Child script, the Fantastic Beasts and Where to Find Them screenplay and the Hogwarts Library digital audiobook.

In the period, revenues were £32.8m, down from the previous year’s £40.3m. Pretax profit was £3.4m, compared with £3.5m. Nevertheless, the result showed that Pottermore is less reliant on new product to maintain turnover—sales have now grown from £7m in 2015 to £15m in 2016 to last year's £40.3m, with the company moving back into profit in the 2017 fiscal year.

Neil Blair, Pottermore chairman, said: "After seven years of operation, Pottermore is an efficient and cash-generative digital publishing business. The company continues to benefit from the open commerce strategy it initiated in 2015, making its content increasingly available globally through online retail and library partners such as Amazon, Apple, Audible, Google, Kobo, Storytel and Overdrive."

With less significant new content in 2017/18, revenues were at more sustainable levels, the company added. Digital publishing sales were supported by additional global distribution and the continued popularity of the Harry Potter stories bolstered by the twentieth anniversary activity in the UK.  New product launches included the audio recording of Quidditch Through the Ages and the new Kindle in Motion version of Harry Potter and the Philosopher’s Stone – Illustrated Edition. The exhibition at the British Library, "Harry Potter, A History of Magic" - running from October 2017 until February 2018 -was also accompanied by new digital publishing.

Pottermore's last reported accounts, to 31st March 2017, showed sales more than doubled to £40.3m, but the company said then that with its turnover dependent on new product it did not expect to grow in this financial next year. The new publications added £12m to that year's turnover, the company said at the time.

Blair added: "Sales of J K Rowling’s Harry Potter e-books and digital audiobooks remain strong and the current financial year to 31 March 2019 - will deliver another good result. Overall the longer-term prospects for the company remain robust.” Trading in the first part of the current year (to 31 March 2019) had been in line with management expectations, the company added.

"Fantastic Beasts: The Crimes of Grindelwald", the sequel to the wizarding world movie "Fantastic Beasts and Where to Find Them", was released in November 2018 and supported by the release of the e-book of the screenplay in multiple languages. Pottermore also published the official audio documentary from behind the scenes of the film production; Fantastic Beasts: The Crimes of Grindelwald – Makers, Mysteries and Magic. September 2018 also saw the 20th anniversary of the release of Harry Potter and the Sorcerer’s Stone in the USA and the move, in October, of the exhibition "Harry Potter, A History of Magic" to New York. This was also accompanied by related digital publishing releases including a digital audio book of the same name, inspired by the exhibition and narrated by Natalie Dormer. 

In March 2018 the company confirmed a small number of redundancies and indicated that it was working on a new strategy for the business.