Lee Enterprises Recognizes Racine Union

With the e-book market showing no signs of returning to robust growth, two of HarperCollins’s main priorities in fiscal 2018 are global expansion and broadening its distribution base in North America, HC’s CEO Brian Murray told PW after the release of the publisher’s financial results for the fiscal year ended June 30, 2017. In the just-concluded year, EBITDA (earnings before interest, taxes, depreciation, and amortization) was $199 million, 7.5% higher than in fiscal 2016, despite a decline of $10 million in sales. Several factors impacted HC’s sales performance: there was one fewer week in the fiscal 2017 than in fiscal 2016, which cost $19 million, and the company suffered from the negative impact of currency fluctuations. Murray said he was “thrilled” with fiscal 2017 from both a publishing and financial standpoint and that the continued decline in e-books isn’t a major concern at the moment. He noted that, in the North American market, gains in print book sales and digital audio made up for the drop in e-book sales and that HC’s print frontlist and backlist sales were almost strong enough to match the revenue generated in fiscal 2016 by Go Set a Watchman. Among the company’s top-selling titles in the year were Hillbilly Elegy by J.D. Vance, The Magnolia Story by Chip and Joanna Gaines, and Jesus Calling and Jesus Always by Sarah Young. Click Read More below for more of the story.

BuzzFeed, long the darling of native digital publishing models, is hitting its brakes following a weakening of advertising demand. The company said it is laying off about 100 employees in the U.S. -- less than 10% of its global workforce -- and restructuring its advertising sales organization “amid a tough digital media market.” In an email to the company's staff, CEO Jonah Peretti announced Greg Coleman is stepping down as BuzzFeed’s president and would take on an advisory role. BuzzFeed News Editor-in-Chief Ben Smith said cuts will not affect BuzzFeed’s U.S. news team directly. Click Read More below for additional information.

For the first quarter, net sales were $540.9 million compared to $388.0 million in last year's first quarter. This 39.4% improvement primarily reflects a comparable sales increase of 40.6%, partially offset by 29 permanent store closures since last year's first quarter. The 40.6% comparable sales improvement was driven by an increase in transaction count and higher average dollar sale. Gross margin was $216.6 million, or 40.0% of net sales, compared to $126.8 million, or 32.7% of net sales, in last year's first quarter. The 730-basis point improvement in gross margin rate primarily reflects higher average unit retail and full price sales combined with occupancy leverage that offset elevated raw material and freight costs. At the end of the first quarter, inventories totaled $325.6 million compared to $209.7 million at the end of last year's first quarter. The $115.9 million, or 55.3%, increase from last year's first quarter primarily reflects elevated on-hand inventories to align with higher consumer demand, an increase in in-transit inventories due to extended in-transit times in the global supply chain, strategic investments in basics and replenishment inventories, and higher average unit costs.