IDW Publishing suffered a decline in sales and an increase in losses vs. the year-ago period in its fiscal Q2 ended April 30, according to the company’s announcement, filings, and conference call. Sales were down 15% for the quarter to $3.74 million. Reasons cited included declines in direct market and game sales, partially offset by a decline in book market returns and increases in specialty and digital sales.
Direct market declines of comic sales were attributed to market weakness. The decline in game sales of $452,000 vs. the year-ago period was attributed to the release of The Legend of Korra game in Q2 2018 with no comparable title in this year’s quarter.
Operating losses from the Publishing division were $1.63 million, an earnings decline from a $1.39 million loss in the year-ago period.
The company is promising better results going forward, with what it says is a stronger release schedule for the second half of its fiscal year (May-October).
There were also some interesting comments in the conference call about publishing plans. First, parent IDW Media Holdings CEO and largest shareholder Howard Jonas described the type of comics the division is charged with producing. “We are focused on stories that appeal to the vast majority of Americans, and audiences worldwide for that matter, who want redemptive stories,” Jonas said, “stories where good triumphs over evil, right defeats wrong, where strong families are at the core of the narrative, and where hard work, persistence, and industriousness are rewarded.”
IDW Media Holdings CFO Ezra Rosensaft spoke of operational changes at IDW Publishing. “The IDW Publishing team is making operational changes to focus more tightly on market opportunities and higher margin offerings, including controlled franchises suited for development by IDW Entertainment,” Rosensaft said.
IDW Media Holdings’ other two divisions, IDW Entertainment and CTM, also generated higher losses for the quarter, although CTM actually eked out a small sales increase. Overall losses for the company were $3.75 million on revenues of $7.81 million.
IDW Entertainment has a lot of programming in the pipe, and expects to deliver October Faction and V-Wars in Q4, and to deliver Locke & Key to Netflix in the first half of its next fiscal year.
The company also announced positive news on its longest-running show this week, revealing that it will begin production on Season 4 of Wynonna Earp. Production appeared to have been delayed by financing issues earlier this year (see “’Wynonna Earp’ Money Problems”). IDW closed on its $23 million raise this spring, which improved its balance sheet and available capital dramatically (see “Former Archie Exec, Archaia Investor, Joins IDW Board”).