LONDON — A resurgent EMI has posted strong interim results, with pre-tax profits up 71.6% to £86.5 million ($140.1 million) on sales of $1.75 billion, up 8.7%.
Excluding $40.2 million from the music major’s licensing deal with online retailer Musicmaker.com, as well as the HMV record store chain, however, pre-tax profits rose 9.9% to $122.1 million, in keeping with the EMI’s Oct. 19 trading statement. The figures cover the half-year ending Sept. 30.
EMI chairman Eric Nicoli, delivering his first set of results, described the group’s performance as “steady progress” in the face of a flat world market.
Market share up
EMI’s global share was up 0.6% to 12.8%. Japan, Latin America and Southeast Asia were singled out as growth markets that are back on track. (In Japan, EMI has scored with the debut album from Utada Hikaru, “First Love,” which has sold 9 million units.)
These upticks countered generally flat sales in Europe — France was up, Germany and the U.K. down — and a decline in North American market share. EMI’s slice of the U.S. market fell from 13% to 10%. Nicoli blamed a weak first-half release schedule.
“Clearly we are not breaking new acts,” Ken Berry, prexy of EMI Recorded Music, told Daily Variety, but that the company is engaged in “a fundamental rethink in A&R” in the U.S.
Berry added that the profit boost tied to new media should not be considered a one-off, but is part and parcel to EMI’s long-term plans. He said he expected the only significant new growth for everyone in the industry would come through digital distribution over the next few years.
Berry’s division was up 8.8% to $1.49 billion in sales. EMI Music Publishing had sales of $257.1 million, up 8.1%.
EMI has also announced it will appoint Tony Bates group finance director, replacing Simon Duffy, who is leaving to become chief exec of European Internet company World Online.
Bates joined EMI in 1990 and played an integral role in the 1992 acquisition of Virgin Music. His current position is exec VP and chief financial officer of EMI Recorded Music.