The German-language publishing group Verlagsgruppe Random House, which is based in Munich, Bavaria, was not part of the Bertlesmann Group’s deal with Pearson to merge Random House and Penguin. It remains a division of Bertelsmann. Outside Germany, Bertlesmann’s Random House merged with Pearson’s Penguin to form Penguin Random House.
Bertelsmann Group stated, “For Random House, 2013 was the year of the historic merger of all its divisions outside Germany with Pearson’s trade publishing division Penguin Group.” The formation of Penguin Random House was completed on July 1, 2013 and the multiyear integration of the two publishing houses is underway.
Penguin Random House has 250 editorially independent imprints across five continents. These include Doubleday, Viking, and Alfred A. Knopf in the U.S.A.; Ebury and Hamish Hamilton in the U.K.; Plaza & Janés in Spain; and Sudamericana in Argentina. Bertelsmann holds 53% of the shares in the world’s largest trade book publisher, while Pearson holds 47%.
This year-end consolidated revenue of €2,700,000,000 for the combined company reflects a full year of Random House, including Germany’s Verlagsgruppe Random House, and a half-year of the Penguin Group. Total sales were 23.9% above Random House’s previous year’s revenue of €2,100,000,000.
Adjusted for currency and portfolio effects, revenues decreased compared with the record year 2012, which was dominated by the exceptional success of the Fifty Shades trilogy. Operating EBIT (earnings before interest and taxes) fell 4.9% from the high level of the previous year – partly due to depreciations in connection with the initial inclusion of intangible assets at Penguin – to €309,000,000 (whereas in 2012 it was €325,000,000).
Return on sales came to 11.6% (whereas in the previous year it was 15.2%). Operating EBITDA (earnings before interest, taxes, depreciation, and amortization) increased to €363,000,000 (whereas in 2012 it was €352,000,000). As a result, the EBITDA margin was 13.7% (whereas in 2012 it was 16.4%). At the end of the year, Penguin Random House had 11,838 employees (whereas on December 31, 2012, Random House had 5,712 employees).
Penguin Random House’s biggest new release was Dan Brown’s Inferno, selling almost 6,000,000 copies in its English-language territories in seven months. Other mega-sellers included Sheryl Sandberg’s Lean In, And The Mountains Echoed by Dr. Khaled Hosseini, The Fault In Our Stars by John Green, and John Grisham’s Sycamore Row. Demand for English, German, and Spanish-language editions of the Fifty Shades trilogy by E L James continued to be strong with more than 7,000,000 print, digital, and audiobook copies sold in 2013.
The American company placed 261 titles on The New York Times hardcover and paperback bestseller lists from July to December, 2013 twenty-seven of them at number one. During the same period, Penguin Random House UK placed fourteen number one titles on the bestseller lists of the Sunday Times.
In Germany, Verlagsgruppe Random House attained major growth in its digital publishing business, achieving first-time double-digit percentage of overall sales revenues with e-books. The division’s biggest-selling title of the year was Die Analphabetin, die rechnen konnte by Jonas Jonasson.
The Bertelsmann Group stated, “A solid business performance in Latin America and a strong portfolio of Spanish-language bestsellers offset the impact of the difficult economy in Spain, where the publishing unit has operated under the name Penguin Random House Grupo Editorial since November. In India and South Africa, Penguin Random House completed the purchase of their respective co-partners’ ownership stakes.”
With new apps, the increasing integration of social media into book marketing and growing e-book downloads, Penguin Random House has advanced its leadership in the transformation to digital.
In the fiscal year 2013, the Bertelsmann Group sold more than 100,000,000 e-books worldwide. Over 77,000 titles are now internationally available in digital form.
A number of Penguin Random House authors received prestigious literary awards in 2013, including Canadian short story writer Alice Munro, the winner of the 2013 Nobel Prize in Literature. The Bertelsmann Group’s authors also won four Pulitzer Prizes, a National Book Award in the U.S., and for Verlagsgruppe Random House, the German Book Prize. Terézia Mora, a Hungarian authoress who moved to Germany in 1990 and writes in German, won the 2013 Deutscher Buchpreis ("German Book Prize") for Das Ungeheuer.