HarperCollins swung from profit of $28 million a year ago to an operating loss of $4 million for their fiscal fourth quarter, including a $3 million impairment/operating charge, finishing the year with an operating loss of $16 million (including $33 million in impairment/operating charges), compared to $160 million in operating income a year ago. (They still show “adjusted operating income” of $17 million for the year.) News Corp. says the deterioration is “largely due to the weak retail market.”
Sales for the fourth quarter fell $72 million at Harper, down 20.5 percent, at $278 million. Full-year sales for the publisher were $1.141 billion, down $247 million from a year ago, or almost 18 percent.
CEO Brian Murray said in a brief statement that “obviously, external factors affected our performance. The general decline in the overall market, the decline in backlist reorders, the Anderson News bankruptcy, and on the international side we faced bad debt charges in the UK with the EUK bankruptcy.” He added that “it was a challenging year, but we held our market share in the U.S., it was slightly up in the UK, and Canada had an outstanding year [offset by the declining value of UK and Canadian currency against the US dollar].” He adds, “We have a good fall list and are looking forward to a new year.”
In yesterday’s conference call, Rupert Murdoch reiterated that they are not planning on developing their own ereading device: “Would we have our own reader or receiver? No, I think that’s highly unlikely. We’re not in the hardware business.”
Overall at parent News Corp, adjusted operating income fell $1.7 billion to $3.6 billion, with sales of $30 billion down 8 percent from $33 billion a year ago. The company had a full year operating loss of $5.7 billion, including $8.9 billion in impairment charges related to goodwill and identifiable intangible assets. In this quarter alone, they took a $452 million pre-tax charge against Fox Interactive Media.