Second Drop for S&S
CBS reported quarterly results this morning, with sales at Simon
& Schuster dropping for the second consecutive quarter, down 12
percent to $201.6 million, with operating income down 32 percent to
$14.6 million. The company says "best-selling titles
CEO Carolyn Reidy says that "if it weren't for the comparison to last
year, I'd say we had a darn good quarter. (THE SECRET, still on
bestseller lists though without the same velocity as a year ago,
comprised $53 million of worldwide revenue in this period a year ago,
on 4.3 million units in all formats.) Reidy notes "we accomplished what
we expected to accomplish, which given this market" is an achievement.
She adds that, "We do see the economy starting to have an effect in
that, although we have a very large number of bestsellers" those titles
are not moving the quantities that such bestsellers have previously
comprised.
The brightest spot was in the UK, where sales for the quarter rose 19
percent, with The Secret having taken off a little later over there,
helped by the Spiderwick movie and other factors. "They have turned a
corner and are booming," Reidy says, noting "we're embracing a growth
plan in the UK."
Despite two consecutive declining quarters in
comparison to previous results, Reidy says they "have every expectation
of beating last year." She says "I don't know at what quarter it's
going to be accomplished; that's going to depend on how the books fall
as we go." But with "a lot of pretty strong books" ahead, she is "not
overly concerned about how we're going to end up."
The situation at Borders, however, "is of concern." Reidy says they are
both "buying more conservatively and limiting their stock" noting, that
"if books are not there, they cannot be sold." She says it
"requires constant vigilance" to keep the chain
aware of and replenished with books that are moving in the marketplace,
and notes "they obviously very much want to turn this around and make
this work."
While the company has new digital initiatives underway and soon will
"be able to actually do something with all the books we've digitized,"
Reidy observes that "we can all see a lot of possibilities, but then
trying to figure out how to actually make anything happen and get a
consumer result out of it is actually much harder than it seems on the
face of it."
Quercus Trade Sales Pass $10 Million, Though Profits Drop
Trade publishing tripled for the UK's Quercus in fiscal 2007, with
sales of 5.5 million pounds, driven by 89 new titles (up from 48 the
year before), while their contract publishing business nearly doubled,
to 3.1 million pounds. But earnings fell by more than half, with
pre-tax consolidated profit of just 150,000 pounds. They say that
"reflects management's decision to invest heavily in personnel,
infrastructure and marketing to prepare for the next stage in the life
of the company." And much of the gain is attributable to Stef Penney's
prizewinning novel THE TENDERNESS OF WOLVES, "which sold more than
300,000 copies during the course of the year."
Management says "in 2008 we are confident that Quercus will cease to be
a small company (defined within the industry as one with annual sales
of less than GBP 10m) to become one of the leading independent
publishing houses in the UK." Plus, they "believe that we now have in
place the strategy, the organisational structure and the publishing
programmes to take the business to GBP 20m over the next three years."
While noting that "prospects for the year as a whole are inevitably
clouded by the threat of reduced consumer spending in the wake of the
credit crisis," the report that so far, "trading in the first quarter
has been satisfactory."
Release
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