Riccardo Cavallero greets me in a hotel lobby in Vitorio, Spain, looking relaxed and happy. Of course, the Random House Mondadori (RHM) c.e.o. has every reason to be cheerful. RHM imprint Plaza & Janes has just released Ken Follett's El Mundo San Fin (World without End), which has become one of the fastest selling books in Spanish history.
The company had started with an initial print run of 550,000. Spain's biggest ever title (Harry Potter and the Deathly Hallows had a first print run of 500,000). Three days after publication, after selling 300,000, RHM reprinted 175,000. Cavallero reckons the book will hit one million in sales by April.
He is in Vitorio for the final leg of Follett's manic and mobbed Spanish book tour, which will be capped by the unveiling of a statue of Follett in the courtyard of Vitorio's cathedral. "We have been a bit surprised by the book's success," Cavallero admits with a laugh. "We obviously expected it to be a bestseller, but not at this rate."
The Follett book has been a good start to the year for RHM, Spain's second largest publisher. Founded in 2001 as a 50/50 joint venture between Random House and Italian publisher Mondadori, the company had a turnover of €101m (£75.2m) in 2006, and made €14.1m (£10.5m) profit. Headquartered in Barcelona, it has 13 imprints with offices spread over three RHM geographic divisions: Spain, South America (Chile, Argentina and Uruguay) and Central America (Mexico, Venezuela and Colombia).
The business in Spain generates 75% of RHM's revenue, on just 55% of the volume, largely due to exchange rates and lower book prices in South and Central America. "For a very few euros we get lots of bolívars," Cavallero says.
While the company operates in markets that are very much like Mondadori's in Italy, it has adopted a corporate culture closer to Random's Anglo-American approach. "We do things that are normal in the UK, but not done so much here," Cavallero explains. "We have the publisher at the centre which everyone works around. We invest very heavily in marketing and are very disciplined about advance information."
The imprints are allowed to operate with as much freedom as possible, Cavallero says. "We let them work like small companies, with that attention to detail and close relationship with authors. All of the companies are profitable, which is not that normal in South America. Being independent is the biggest asset you can offer to a publisher."
Cavallero says the South and Central American market is challenging; a lack of a middle class means that books are bought by a very small percentage of the population. Publishing programmes are made up of a few imports from Spain, but are driven mostly by local, often highly politicised non-fiction titles, which can be problematic: "How can I say it in a polite way?" Cavallero asks. "Democracy is a young institution in South America and sometimes governments don't like what we publish."
And the dangers are not just from the governments; politician and RHM author Íngrid Betancourt was kidnapped by Colombia's FARC (Revolutionary Armed Forces of Colombia) rebels in 2003 and has yet to be released.
Piracy is also a problem, combined with a lack of a political will to tackle the issue. "There is not a lot we can do," Cavallero says. "To solve the piracy problem would be very easy. The pirates buy paper from where we do, print from where we print. It's not that difficult. But we're normally happy because pirates are the best editorial plan on earth. If your book is on the pirate bestselling list, it's good news."
RHM also publishes in North America, which Cavallero says has not proved to be the "El Dorado" the company had hoped for. There are many Spanish speakers in the US, but the market varies almost from city to city. Sales are not helped by the retailers: "I would be more than happy to see Barnes & Noble and the other chains give to Spanish books the same amount of space they give to African-American books. You just can't find the books [in shops]. That is why the biggest channel we have in North America is Amazon."
Turin-born Cavallero has been c.e.o. of RHM since the merger, having worked in various roles for Mondadori since 1995. In 2003, he steered the company through a painful restructure, with RHM shedding 220 jobs, 25% of its staff. The publishing programme was also trimmed, from about 1,500 titles a year to 800. The company's bottom line has since increased, boosted by a paperback programme, which makes up about 40% of the list.
In Spain, RHM is traditionally the market leader in literary fiction and non-fiction. The group is also working on launching authors and selling rights abroad. The biggest recent success has been Ildefonso Falcones, whose debut La Catedral del Mar (Cathedral of the Sea) shifted an astonishing 1.5 million copies in Spain alone. It has been sold into 33 countries and will be published in the UK in March by Doubleday.
"It's not normal for a Spanish publisher to export authors," Cavallero says. "It has taken a long time to gain credibility in international markets and now we have it."
RHM also publishes successful foreign writers such as Follett and four of the last six Nobel laureates, including Doris Lessing. In 2008, it will publish John Grisham, who Cavallero says has been underpublished in Spain, after acquiring his newest novel The Appeal, and his entire backlist.
Overall, Cavallero is pleased at the group's growth and says Random and Mondadori are, too. He thinks the geographic distance between himself and the boards helps. "If your shareholders are far away and you're profitable, that's lovely," he says. "It's a relationship that could last forever."