Over 93% First-Class Mail Delivered On-Time for 8 Consecutive Weeks

Hearst UK recently announced that women’s lifestyle magazine Prima would increase its print edition from 12 to 13 issues a year, following a 68% surge in subscriptions this year. This week, we talk to Prima’s Editor Jo Checkley about what factors led to the decision to increase the frequency of the magazine, how their content has encouraged a community feel among their readers, and what lessons they’ll be taking from producing magazines in lockdown. Jo also outlines what she’s done to keep her magazines thriving during her career despite tough market conditions for women’s titles. In the news roundup the team discusses Future Plc’s resurgent fortunes and purchase of GoCompare, the UK government’s attempts to create a competition regime to tackle the ‘fundamental imbalance of power’ between platforms and publishers, and Spotify launching a Stories copy. Esther is a meerkat.

Domestic gross profit rate was 22.8% versus 24.0% last year. The gross profit rate decrease of approximately 120 basis points was primarily driven by higher supply chain costs as a result of the increased mix of online revenue and lower profit-sharing revenue from the company’s private-label and co-branded credit card arrangement. Domestic GAAP SG&A was $1.56 billion, or 17.1% of revenue, versus $1.76 billion, or 19.9% of revenue, last year. On a non-GAAP basis, SG&A was $1.54 billion, or 16.9% of revenue, versus $1.74 billion, or 19.7% of revenue, last year. Both GAAP and non-GAAP SG&A decreased primarily due to: (1) reduced store payroll expense; (2) lower advertising expense; (3) reduced incentive compensation expense, as the company did not pay or accrue short-term incentive expense for second quarter performance; and (4) lower medical claims expense. International revenue of $782 million increased 9.4% versus last year. This increase was primarily driven by comparable salesgrowth of 15.1%, which was partially offset by the impact of approximately 490 basis points of negative foreign currency exchange rates. International SG&A was $142 million, or 18.2% of revenue, versus $166 million, or 23.2% of revenue, last year. SG&A decreased primarily due to lower payroll and benefit expense, primarily in Canada, and the favorable impact of foreign exchange rates.

At the end of 2020, the Hachette Book Group was the fourth-largest trade publisher in the country, with estimated annual sales of roughly $700 million. When the acquisition of Simon & Schuster—the third-largest trade publisher—by #1 trade publisher Penguin Random House is finally completed, HBG will move into the third spot. Last week, HBG took a major step to ensure that it will assume S&S’s position as the largest trade publisher behind PRH and HarperCollins, with its agreement to acquire Workman Publishing for $240 million. One of few remaining independent publishers of its size, Workman had sales of $134 million last year, and its addition will get HBG revenue over the $800 million level.