Warner Music Tops $1.2 Billion in First Fiscal Quarter

In its fiscal first-quarter earnings report, Warner Music Group announced a 15 percent increase in revenue to $1.2 billion in its fiscal first quarter, from $1.045 billion in the same period last year, while also seeing its net income rise to $86 million from $5 million. That feat saw the company edging past Sony Music for the quarter, which posted $1.029 billion.

WMG’s recorded-music operation also grew 15.1% (17.8% in constant currency) to $1.041 billion from $904 million, a new high for the division as a stand-alone operation. That company also posted $147 million in operating income, up 63 percent from $90 million. Operating income before depreciation and amortization totaled $215 million, or a 39 percent increase from the previous year’s $155 million. The company also said its recorded music division saw a net gain of $76 million from the acquisition of EMP, which was offset by $24 million in revenue lost to divesting its concert-promotion operation and a change in accounting practices.

Nearly half of the company’s recorded-music revenues came from streaming, which generated $502 million and is up by $98 million year over year.

The company said recorded music revenue was fueled by the performance of albums by the late Johnny Hallyday, along with Ed Sheeran, Michael Buble, Kobukuro and the “Greatest Showman” soundtrack.

“Our first-quarter results are evidence that our long-term strategy is paying off,” said Eric Levin, Warner Music Group’s Executive Vice President and CFO.  “Our Recorded Music business alone exceeded $1 billion in revenue, and we also had strong OIBDA and cash flow.”

Its Warner/Chappell music-publishing operation, which grew 15 percent to $165 million from $143 million, although that gain was attributed to the aforementioned change in accounting practices. The division did see a big improvement in operating income, which grew to $22 million year over year from a $1 million operating loss.

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