MI2N
Music Industry News Network
TUESDAY, SEPTEMBER 2ND
Advanced Search
MusicDish Advertising Network
Subscribe to Mi2N's Free Newsletters B2N (business) i2N (indie)
HOME | FREE NEWS SUBMISSION | PREMIUM PR DISTRIBUTION | PR COPYWRITING | RSS FEEDS | TESTIMONIALS | CONTACT

Sections: Band | Business | Career | Events | Label | Music Releases | Radio | Tech | Video | Web Events
Genres: Country/Folk | Dance/Electronica | Jazz/Blues | Latin | Rock | Urban | World
International: Asia | Canada | Europe

Advertise | Artist Development | Submit Video | MusicDish*China | MusicDish e-Journal | MusicDish Network | Urban Music News Network
Label News (more headlines) 02-17-2013

Warner Music Group Corp. Reports Results For The Fiscal First Quarter Ended December 31, 2012

Bookmark and Share
Warner Music Group Corp. today announced its fiscal first quarter financial results for the period ended December 31, 2012.

"We are pleased with the start we've had to our fiscal year," said Stephen Cooper, Warner Music Group's CEO. "We continue to make progress throughout our organization, while maintaining our focus on long-term artist development, innovation and growth and carefully managing costs."

"Digital revenue, OIBDA and OIBDA margin all showed solid growth," added Brian Roberts, Warner Music Group's Executive Vice President and CFO. "Even with $132 million in cash outflows in the quarter associated with our refinancing, we had $189 million of cash on our balance sheet as of December 31, 2012."

Total WMG Summary Results
For the quarter, revenue declined 0.8%, but grew 0.3% in constant currency. Despite a difficult year-over-year comparison resulting from strong physical sales of Michael Bublé's "Christmas" in the prior-year quarter, the company's stable revenue results reflect solid digital revenue growth in both Recorded Music and Music Publishing, as well as growth in Recorded Music licensing revenue, offset by a decline in physical sales and non-digital Music Publishing revenue. Digital revenue represented 33.2% of total revenue for the quarter, compared to 28.3% in the prior-year quarter. The growth in digital revenue reflects growth in subscription and streaming revenue as well as download revenue.

Operating margin expanded 1.6 percentage points to 6.6% from 5.0%. OIBDA margin expanded 1.8 percentage points to 14.6% from 12.8%. Improvements in OIBDA and OIBDA margin reflect lower artist and repertoire costs, severance charges, variable compensation expense and professional fees incurred in connection with the sale of EMI and subsequent regulatory proceedings. Operating income and OIBDA for the quarter included $5 million of severance charges (all in Recorded Music), compared to $7 million of severance charges in the prior-year quarter ($5 million in Recorded Music and $2 million in Corporate). (See Figures 4 and 5 below for calculations and reconciliations of OIBDA and OIBDA margin.)

Net loss reflects the impact of an $83 million loss on the extinguishment of debt in connection with the company's November 2012 refinancing of certain indebtedness.

As of December 31, 2012, the company reported a cash balance of $189 million, total long-term debt of $2.225 billion, including $30 million included in the current portion of long term debt, and net debt (total long-term debt minus cash) of $2.036 billion. During the quarter, the company used $132 million of cash in connection with its November 2012 refinancing.

Cash used in operating activities was $10 million compared to cash provided by operating activities of $25 million in the prior-year quarter. Free Cash Flow was negative $25 million compared to positive $14 million in the prior-year quarter. The largest drivers of the decline in cash provided by operating activities and Free Cash Flow were a $21 million increase in cash interest due to the timing of prior-year interest payments, resulting from the company's acquisition debt refinancing, and the timing of working capital, which included higher variable compensation payments, higher artist and repertoire spend offset by higher cash collections in the quarter. (See Figure 7 below for a calculation and reconciliation of Free Cash Flow.)

Recorded Music Summary Results

Recorded Music revenue declined 0.3%, but grew 0.8% in constant currency. The company's Recorded Music business experienced an increase in digital revenue, as subscription and streaming revenue and download revenue were both strong. Recorded Music digital revenue represented 36.1% of total Recorded Music revenue, compared to 31.1% in the prior-year quarter. Domestic Recorded Music digital revenue was $128 million, or 49.4% of total domestic Recorded Music revenue, compared to 44.9% in the prior-year quarter.

While the company's releases performed well in the quarter, they faced a difficult comparison against strong physical sales from Michael Bublé's "Christmas" in the prior-year quarter. As a result, digital revenue growth was more than offset by the decline in physical revenue. Licensing revenue grew 13.2% as a result of strong international broadcast revenue in the U.K. and Asia Pacific, while Artist Services and Expanded Rights revenue was flat, with domestic growth from merchandising sales being offset by international declines in the company's European concert promotion businesses. Revenue growth in the U.S., Japan, Latin America and Canada was offset by declines in the U.K., Italy and other parts of Europe. Major sellers included Led Zeppelin, Bruno Mars, Michael Bublé, Johnny Hallyday and the Génération Goldman tribute album.

Recorded Music operating margin expanded 1.7 percentage points to 11.3% from 9.6% in the prior-year quarter. Recorded Music OIBDA margin expanded 1.6 percentage points to 17.4% from 15.8% in the prior-year quarter. OIBDA and OIBDA margin improvement were driven by lower artist and repertoire costs and variable compensation expense.

Music Publishing Summary Results

Music Publishing revenue declined 4.1%, or 3.3% in constant currency. 26.7% growth in digital revenue, driven by increases in subscription and streaming revenue and download revenue, was more than offset by the expected decline in mechanical revenue of 21.2%, reflecting the ongoing transition from physical to digital sales in the recorded music industry. Performance revenue was relatively flat, declining 2.1% as a result of an unfavorable currency impact, and synchronization revenue declined 4.3%, reflecting lower video game revenue.

Music Publishing operating margin contracted 0.9 percentage points to negative 0.9% from zero in the prior-year quarter due to a slight increase in depreciation expense. Music Publishing OIBDA margin expanded 0.6 percentage points to 13.8% from 13.2% as a result of lower variable compensation expense.



Bookmark and Share

back | top



MusicDish Advertising Network

Mi2N Music PR

Momentous Game Of Thrones Music And Video Released To Introduce Musicnotes And Jarrod Radnich Partnership

GINGIO Is Set To Assist The Music Industry With Exceptional Services

Plunky & Oneness Release "Never Too Late (Go-Go Remixes)" Maxi-Single

Provocative Beijing Rockers Second Hand Rose To Play NYC, DC, Philly, Boston

NC Handcrafted Ukulele To Be Raffled For LEAF

IES - Indie Entertainment Summit Wraps Up Third Consecutive Successful Edition In L.A. To A Global Audience As The Greatest Event For Indie Artists, Producers & Labels

ROCK AND ROLL REVIVAL!

IAMA Winner Meghan Trainor Hits #1 On Billboard Charts



MusicDish*China Song Blast
Promote Your Music Single In China

News Headlines
Mi2N EDITOR'S PICKS
» Streaming Music Subscriptions To Exceed $3bn In USA And Western Europe This Year
» New 50/25 Watt Additions Grow PRS Guitars’ Popular Archon Amplifier Line Up
» Curb Records And Sweetwater Rain Announce The Addition Of Kaitlin Walker To The Band
» Disturbing New Music Video Shines A Light On The Dark Side Of Love
» Vertex Standard Strengthens EVerge™ Digital Radios
» Vince Szydlowski Named Senior Vice President, Label Sales For Capitol Music Group
» Music2Deal – The Community For The Music Industry Now Also Available On Mobile Devices
» The Modern Sky Festival Expands To U.S. Confirming Two Days In New York's Central Park With Cat Power, Atomic Bomb!
» New Zealand Rock Band SALT To Release New Album
» AFM President Blasts NFL Super Bowl Halftime Kickback Scheme


Get your music news covered...
Have your press release written
by the pros at Mi2N

Articles
MUSICDISH E-JOURNAL
» BROBST Electro-Rock Leads MusicDish*China Top 5 Indie Song Chart
» Love And Peace 2014 Outdoor Camping Music Festival
» MusicDish*China Top 5 Indie Song Chart (Vol. 1, No. 4)
» The Courtesans Drives MusicDish*China Top 5 Indie Song Chart
» FM Pilots Skyrockets To Top Of MusicDish*China Indie Song Chart
» MusicDish*China Top 5 Indie Song Chart 07/19-07/25/2014
» Zebra Music Festival (Shanghai) Ticket Giveaway Winners
» MusicDish*China Top 5 Indie Song Chart 07/12-07/18/2014
» Temple Bar 3 Year Anniversary
» Zebra Music Festival (Shanghai) Announces Headlining Acts (Chinese Version)
» Raising Our Voices For Fennie: Benefit Concert Zajia Lab, July 13
» Raising Our Voices For Fennie: Benefit Concert Zajia Lab, July 13 (Chinese Version)

Mi2N's Music PR distribution service guarantees online exposure for your press release. Choose from seven (7) different packages.


HOME | FREE NEWS SUBMISSION | PREMIUM PR DISTRIBUTION | PR COPYWRITING | RSS FEEDS | TESTIMONIALS | CONTACT

Sections: Band | Business | Career | Events | Label | Music Releases | Radio | Tech | Video | Web Events
Genres: Country/Folk | Dance/Electronica | Jazz/Blues | Latin | Rock | Urban | World
International: Asia | Canada | Europe

Advertise | Artist Development | Submit Video | MusicDish*China | MusicDish e-Journal | MusicDish Network | Urban Music News Network
Copyright © 1997-2014 MusicDish LLC, all rights reserved. Text, graphics, and HTML code are protected by US and International Copyright Laws, and may not be copied, reprinted, published, translated, hosted, or otherwise distributed by any means without explicit permission.