About Houghton Mifflin Harcourt Publishing Company
Houghton Mifflin Harcourt Company (HMH) would like to thank all the professional students out there. The firm is a publisher of educational material, covering areas from pre-K through grade 12, as well as adult learners. HMH publishes textbooks and printed materials, and provides digital content online to more than 50 million students and over 130,000 school districts in some 150 countries. It also publishes fiction (including J.R.R. Tolkien's The Lord of the Rings series and the popular line of Curious George books), as well as nonfiction titles and reference materials, and offers professional resources and educational services to teachers. HMH primarily sells to customers in the US.
Houghton Mifflin operates into two business segments: Education and HMH Books & Media (formerly referred to as Trade Publishing).
Education division specializes in comprehensive core curriculum, supplemental and intervention solutions, and ongoing support in professional learning and coaching for educators and administrators. This segment accounts for more than 85% of the company's sales.
HMH Books & Media division accounts for nearly 15% of the company's sales and has brought renowned and awarded children's, fiction, non-fiction, culinary and reference titles to readers throughout the world. This segment has published books such as Curious George, Carmen Sandiego, The Lord of the Rings, The Whole 30, The Best American Series, the Peterson Field Guides, CliffsNotes, and The Polar Express.
Headquartered in Boston, Massachusetts, HMH operates over 130,000 school districts in some 150 countries. The company also has several offices and warehouse located in Indiana, Missouri, Florida, Illinois, New Hampshire, New York, Texas, and Ireland.
Sales and Marketing
HMH's distribution channels includes online retailers and ecommerce sites, digital delivery platforms, social media, digital discovery and marketing platforms.
The company operates predominantly within the U.S. K-12 Education market. The U.S. Education market comprises of over 130,000 public and private schools, nearly four million teachers and some 50 million total student enrollment across public, private and charter schools.
Internationally, the company exports and sells K-12 English language education products to premium private schools that utilize the U.S. curriculum, who are located primarily in Asia, the Pacific, the Middle East, Latin America, the Caribbean and Africa.
HMH's advertising costs were $12.6 million, $12.0 million and $12.4 million for the years 2019, 2018 and 2017, respectively.
Like many educational publishing companies, HMH has struggled with challenges relating to a transition away from print as schools increase their use of digital materials in the classroom. Its revenues have risen in the past five years, barring a slight fall in 2016. However, in the five years between 2015 and 2019, HMH has failed to post profits and instead continues to record a net loss for the fifth consecutive year.
Sales in 2019 increased 5% to $1.4 billion from $1.3 billion the prior year. The increase was driven by an $88 million increase in its Education segment, offset by a $19.7 million decrease in its HMH Books & Media segment.
HMH reported a net loss of $213.8 million in 2019 versus $94.2 million in 2018. The company's operating loss in 2019 unfavorably changed by $72.6 million from a loss of $90.5 million in 2018 to a loss of $163.2 million primarily due to an increase in cost of sales, net amortization expense, restructuring/severance, and selling and administrative expenses. These decreases were partially offset by a $68.3 million increase in net sales.
HMH finished 2019 with $296.4 million in cash and cash equivalents. Net cash provided by operating activities was $255 million. Net cash used in investing activities was $96.3 million while net cash used in financing activities was $115.7 million. HMH's primary cash uses in 2019 were for acquisitions, long-term debt payments, and deffered financing fees payments.
HMH has a strategic transformation plan to simplify its business model and accelerate growth. This includes new prodyct development and go-to-market capabilities, as well as the streamlining of operations company-wide for greater efficiency, referred to as 2019 Restructuring Plan. These actions resulted in the net eliminaton of approximately 10% of its workforce, and an approximately 20% reduction in previously planned content development expenditures over the next three years.
In 2019 the Trade segment, which houses HMH Productions and HMH Audio, was renamed Houghton Mifflin Harcourt Books & Media. HMH is now organized along two business segments: Education and Books & Media. Education is its largest segment representing approximately 87% of sales, while the former Trade Publishing accounts for approximately 13%.
The company continues to work towards its strategy of advancing its transformation from K-12 publisher to a comprehensive learning company. It aims to do so by enhancing its core offerings, developing more integrated solutions, and divesting certain products.
Meanwhile, the company's newly formed HMH Productions launched the series Carmen Sandiego on Netflix as part of its strategy to expand its content across media platforms. The segment also launched HMH Audio in early 2019 with the goal of capitalizing on the growth of downloaded audiobooks.
Mergers and Acquisitions
In 2019, HMH completed the acquisition of PV Waggle LLC, which comprised a web-based adaptive learning solution providing Math and English Language Arts ("ELA") instruction for students in grades 2-8 for a total purchase price of approximately $5.4 million.
125 High St Ste 900
Boston, MA 02110-2777
Phone: 1 (617) 351-5000
Employer Type: Privately Owned
Executive Vice President: Bill Bayers
Executive Vice President: Michael Muldowney
Vice President K 12 Finance: Prescott Taylor
Employees (This Location): 970
Employees (All Locations): 3,300
San Diego, CA
Pompano Beach, FL
Royal Palm Beach, FL
Rolling Meadows, IL
Villa Hills, KY
New York, NY
New Franklin, OH
Fort Worth, TX
Seoul, South Korea