Harlequin Had a Promising First Quarter

Twenty-three hours and counting: There's good news, bad news and worse news.

The good news is that TXU has restored electricity to 200,000 of the 300,000 households that lost power last night. The bad news is that I'm in the last 100,000 homeowners who still don't have power. And they're still saying it may take up to a week to restore power to that last third.

The worse news is they've just announced a thunderstorm is brewing in Tarrant County (Fort Worth), expected to arrive in Dallas County in the next thirty minutes. I'm in my office at the university and am so NOT moving. There's a tornado warning until 7:45 PM with rotation movement seen near Six Flags.

Torstar, the parent corporation of Harlequin, reported its results yesterday, and the news was very encouraging. According to the press release, "Book Publishing revenue was $124.5 million (Canadian) in the first quarter, up $6.2 million (Canadian) in the same period last year." Of that C$6.2 million, C$5.1 million was the result of favorable foreign exchange rates.

The book publishing operating profit was C$19.1 million in the first quarter, up $4 million for the same quarter last year. The company reported growth in the North American Retail division "with more books sold in both the series and single title businesses."

You'll recall that Harlequin's women's fiction operation has three divisions: North American Retail, North American Direct-to-Consumer (the famous bookclubs), and Overseas.

When we look at revenues by division, North American Retail was up C$3.8 million, North American Direct-to-Consumer was down C$.4 million and Overseas was up C$.3 million. Harlequin reported that the increase in eHarlequin (e-books) was more than offset by the decline in the traditional direct mail business.

"Overseas results were flat in the first quarter of 2007 with improved results in the Nordic group and Germany offset by lower results in several other markets."

Publishers Weekly reported: "Parent company Torstar reiterated that it expects Harlequin to have a "stable" 2007, as the positive trends in its North America retail business is offset by weakness in the direct mail business, while the international group is predicted to have a mixed year."