Warner Music Group Corp. announced its first-quarter financial results for the period ended December 31, 2013.
•Revenue grew 7% on a constant-currency basis
•Digital Recorded Music revenue increased 9% on a constant-currency basis
•Adjusted OIBDA up 7% with growth in both Recorded Music and Music Publishing
“There were a number of bright spots this quarter, including strong growth in steaming revenue for our recorded music business and solid performance from our music publishing business,” said Stephen Cooper, Warner Music Group’s CEO. “While we had a light release schedule this quarter, we are enthusiastic about our release schedule for the second half of the fiscal year.”
“We maintained our Adjusted OIBDA margin for the overall business this quarter and expanded our Music Publishing OIBDA margin,” added Brian Roberts, Warner Music Group’s Executive Vice President and CFO. “Additionally, we remain on track with our PLG integration plans.”
For the quarter, revenue grew 6.0% (or 6.8% in constant currency), driven by the July 1, 2013 acquisition of Parlophone Label Group (PLG). Excluding PLG revenue, revenue declined 3.6% (or 2.9% in constant currency), due to a lighter release schedule than in the prior-year quarter.
Recorded Music revenue grew 5.2% (or 6.1% in constant currency), due to the acquisition of PLG. Excluding PLG, revenue declined 6.1% (or 5.2% in constant currency) due to the release schedule. Including PLG, artist services and expanded rights revenue, licensing revenue and digital revenue all grew, but were partially offset by a decline in physical revenue.
Music Publishing revenue grew 10.3% on both an as-reported and constant-currency basis as digital, synchronization, performance and mechanical revenue all grew. Digital revenue grew 10.5% (or 5.0% in constant currency), due to growth in streaming revenue. Synchronization revenue was up 18.2% (or 23.8% in constant currency), reflecting growth in many segments in the U.S. including commercials, movies and videogames. Performance revenue was up 8.5% (or 10.9% in constant currency), and mechanical revenue grew 3.8% on both an as-reported and constant-currency basis, both driven by the timing of collection society distributions.