This from the terribly wise Rachelle Gardner. Most writers don’t seem to understand this part of the business, so please have a read – it’s essential to know the business you’re in and its workings – it’s in your own interests to be an informed writer. This is an American agent, so things may differ slightly to the Oz scene, but it will give you the general idea.
“The concept of a royalty is that the author receives a percentage of the revenue for each book sold. The exact percentage can’t be generalized because it depends on a variety of factors: the size of the publisher, whether it’s a CBA or ABA house, the author’s platform and saleability, and each publisher’s own criteria (of which you may never be aware).”
http://cba-ramblings.blogspot.com/2009/11/how-book-royalties-work.html