Strategic Treasury

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Interview – Virginie Mercier Virginie Mercier talks to TMI about the finance department at Editis, which is the second largest publisher in France.

Interview - Virginie Mercier

Treasurer, Editis Group

“Very high demands when it comes to forecasts”

La Lettre du Trésorier

How is the Editis group structured?

Virginie Mercier

With around twenty publishers and forty brands, covering literature, education and reference and distribution, Editis is the second largest publisher in France. It is in first place when it comes to large format and pocket literature – working with publishing houses such as Robert Laffont, Plon-Perrin, La Decouverte, Le Cherche-Midi, Les Editions XO, Les Editions First-Gründ and Univers Poche. Editis is also in pole position in the education and reference market, with success in books for schools, extracurricular books, educational material, dictionaries, practical and illustrated works, with brands such as Nathan, Le Robert, Bordas. In Belgium, De Boeck is the undisputed leader of school, university and legal publishing.

Editis is also a key player in distribution thanks to its subsidiary Interforum which, through its logistical expertise and numerous points of sale in France and branches abroad – Belgium, Switzerland, Canada, deals with all the group’s works and around twenty-four external editors. Editis is also at the heart of digital publishing, with E-Platform, which is a communal platform, developed by Editis, which brings together over one hundred publishing houses including Media-Participation, Michelin guides, Michel Lafon and Grupo Planeta. It gives unique access to the catalogues of partner editors to all those involved in the sale of online content. Bought from Wendel in 2008 by Groupe Planeta, one of three main communication groups in Spain, Editis has a turnover of around €750m. Its publishing houses, which enjoy total editorial independence, have access to the circulation and distribution capabilities of Interforum.

The publishing houses have complete editorial independence. Is that also the case in treasury?

No. Although the subsidiaries keep their own specialisation and manage their own brands, the prevailing logic in the treasury is very centralist. Management of cash flow, banking relations, risk and finance are carried out at group level. When it comes to cash flow, we use manual cash pooling where all the cash flow is centralised on a daily basis at one point in the treasury group, with a first level cash pool for the three main areas of activity – literature, education and reference, and distribution – to which a cash pool is added every day from our activities in Belgium, mostly from De Boeck. In addition we bring back the cash from our distribution subsidiaries in Canada and Switzerland once a month. Almost all collection is carried out by Interforum, our subsidiary which distributes and circulates the publications from the two main areas of business along with third party editors. Our activity generates a large working capital at certain times of year: we are sometimes borrowers, mostly in the summer, and investors at the end of the year.

What sort of investments have you used?

Bearing in mind the cyclical nature of our cash returns, we never have a structural ‘cushion’ for long-term investments. We therefore try above all to invest in liquid and secure products. For the time being, all of the available liquidity has been put in a very short-term money-based unit trust. However, the follow-up of results is systematic, and we watch products and the performance of the competition carefully. Moreover, we are very mindful of interest-bearing liquidity accounts, of whose merits certain local banks speak highly. Their ease of use – returns known in advance, money can be transferred at any time – could be of interest to us.

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