Third-quarter 2017 revenue Revenue for Q3 2017: 1,852 million, up 2.2% like-for-like(1)/(2)Lagard re confirms its recurring EBIT growth target(2) for 2017 at between 5% and 8%(3)
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After a solid first-half performance, the Lagard re group continued its like-for-like growth momentum, buoyed by good results at Lagard re Travel Retail.
Revenue for the Group in the third quarter of 2017 came to 1,852 million, up 2.2% like-for-like and down 6.3% on a consolidated basis. The difference between like-for-like and consolidated figures is primarily attributable to the divestment of Press Distribution operations by Lagard re Travel Retail. Changes in foreign exchange rates over the period, are chiefly linked to the US dollar and pound sterling.
By division (like-for-like basis):
Lagard re Publishing: revenue was down 2.1%, as expected, primarily linked to the success of Harry Potter and the Cursed Child in third-quarter 2016. However, Education posted a good performance, driven by curricular reform in France.
Lagard re Travel Retail: continued business growth (up 7.9%), buoyed by the extension of networks and by the rise in passenger traffic, especially in the EMEA region.
Lagard re Active: revenue was down 2.1% due to Press and Radio activities that followed the market s downward trend. However, Press circulation turned in a good performance and TV operations rallied.
Lagard re Sports and Entertainment: the 8.0% decline in revenue was mainly the result of the sporting calendar.
At 30 September 2017:
Revenue for the first nine months of 2017 totalled 5,158 million, up 4.2% like-for-like and down 4.6% on a consolidated basis.
The difference between like-for-like and consolidated figures is essentially related to the divestment of Press Distribution operations by Lagard re Travel Retail, which was partly offset by acquisitions at Lagard re Publishing.
Changes in foreign exchange rates are primarily linked to the depreciation of the pound sterling.
Over the first nine months of the year, revenue growth was powered by good performances at Lagard re Travel Retail and Lagard re Publishing and by a favourable calendar effect at Lagard re Sports and Entertainment.
I- REVENUE AND ACTIVITY BY DIVISION
Lagard re Publishing
Revenue at 30 September 2017 came in at 1,665 million, up 1.5% like-for-like (up 1.2% on a consolidated basis). The difference between these two figures reflects a 27 million positive scope impact resulting mainly from the acquisitions of Perseus, Brainbow, Bookouture and IsCool Entertainment, and a 31 million negative foreign exchange effect, relating chiefly to the depreciation of the pound sterling.
Over the first nine months of the year, the activity delivered a good performance in Partworks (up 9.3%) and in the United States (up 2.2%). This offset lacklustre activity in the United Kingdom resulting from an unfavourable comparison effect linked to the huge success of Harry Potter and the Cursed Child, which was published in third-quarter 2016.
Third-quarter 2017:
At 646 million for the quarter, revenue declined as expected, hit by an unfavourable comparison effect (down 2.1% like-for-like and down 4.3% on a consolidated basis). The difference between like-for-like and consolidated figures chiefly reflects a 2 million positive scope impact and a 17 million negative foreign exchange effect.
The figures below are presented on a like-for-like basis.
In France (up 6.0%), revenue was mainly driven by educational publishers successful implementation of the second year of curricular reform (particularly in the middle school segment). General Literature was boosted by a strong performance from Livre de Poche paperbacks over the summer, and by the success of Laetitia Colombani s La tresse (Grasset) and Erik Orsenna s La Fontaine : une cole buissonni re (Stock).
In the United States, the 2.8% drop in revenue reflects a lighter release schedule. Perseus s good results failed to offset the unfavourable comparison effect resulting from the strong third-quarter 2016 performance, which had been boosted by the success of new titles such as Nicholas Sparks Two by Two and James Patterson s Woman of God.
The United Kingdom saw a significant fall in revenue as expected, down 13.5% owing to an unfavourable comparison effect, with third-quarter 2016 having been boosted by the success of Harry Potter and the Cursed Child. Adult Trade turned in a strong performance thanks to releases including Martina Cole s Damaged and four new Famous Five titles.
As expected, revenue was down in the Spain/Latin America region, retreating 11.5% on the back of an unfavourable comparison effect linked to curricular reform in third-quarter 2016.
Partworks delivered bullish growth (up 12.1%), led by a record number of new titles in July and August and by a good backlist performance, especially in Japan and Spain.
E-books accounted for 7.2% of total Lagard re Publishing revenue in third-quarter 2017, versus 6.8% in third-quarter 2016.
Lagard re Travel Retail
Revenue for the division totalled 2,545 million at 30 September 2017, up 8.6% like-for-like (down 8.6% on a consolidated basis). The difference between like-for-like and consolidated figures results from an 11 million positive foreign exchange effect linked primarily to a rise in the Polish zloty, Australian dollar and Icelandic krona, and from a 450 million negative scope impact, breaking down as:
a 464 million negative impact from deconsolidations, essentially Press Distribution operations in Belgium, Hungary, Spain and Canada;
a 14 million positive impact from acquisitions, relating mainly to the consolidation of Duty Free operations in Poland (Warsaw Modlin airport) and Estonia.
Third-quarter 2017:
Revenue for the division totalled 917 millio
