Chief executive says US recorded music operation is close to securing 50% of revenues from digital
Warner Music Group, which is being taken over by Len Blavatnik's Access Industries in a $3.3bn deal, has reported revenue growth of 1.6% year on year in the first three months of 2011.
The music company ? which said that top sellers in the quarter included Bruno Mars, REM and Cee Lo Green ? said total revenues were $682m.
Digital revenue grew 8% year on year on a constant currency basis, thanks mostly to growth in downloads and streaming, to $220m, accounting for 32% of total group revenues.
Edgar Bronfman Jr, chief executive of Warner, said the US recorded music operation was now close to 50% of revenues coming from digital.
However, total operating income fell by a third, from $24m to $16m, thanks in part to $7m in severance charges. Warner posted a net loss of $38m for the quarter.
"Our focus on disciplined A&R investments, successful revenue diversification and innovative digital strategies has helped us to grow both our recorded music and music publishing revenue," said Bronfman.
Warner said US revenue grew 2.6% year on year, while international revenue grew 0.3% on a constant currency basis.
The UK, Japan and "other parts of Europe" suffered revenue declines but this was offset by growth in France, the US, Canada and "certain Asia-Pacific countries".
WMG's recorded music division grew 1.1% year on year on a constant currency basis to $550m. Within this total, US revenue grew 0.4% to $254m. International recorded music revenue was up 1.7% on a constant currency basis to $296m.
Total digital revenues in the recorded music division grew 5.7% year on year on a constant currency basis to $205m. Digital revenues from the international operation surged 12%, to $83m, while the US grew just 1.7% to $122m.
WMG's publishing division saw revenues rise 2.2% year on year on a constant currency basis to $137m. US music publishing grew 13% and international revenue fell 5%. Total digital revenue at the division grew 30.8% to $17m. Operating income fell from $43m to $31m.
As of 31 March, Warner Music held a cash balance of $319m with total debt of $1.95bn and net debt of $1.63bn.
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Source: http://www.guardian.co.uk/business/2011/may/10/warner-music-group-revenues-up
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