BMG Revenues Up 10% for 2019, Company Is ‘Well Prepared’ to Weather Coronavirus Pandemic
By Variety Staff
LOS ANGELES (Variety.com) – In its earnings report for 2019, , the world’s fourth biggest music rights-holder, showed a revenue increase of 10.1% to $674 million for the year, according to Music Business Worldwide . The figures are included in the latest report from the firm’s Germany-based parent, Bertelsmann, which also showed that BMG’s operating EBITDA (Earnings before Interest, Tax, Depreciation and Amortization) at $155 million for the year — a 13.1% jump from last year’s
That operating EBITDA was up 13.1% on the prior year’s haul of $132 million, a profit margin of 23%.
To many, last year’s earnings are a secondary concern compared with what is looking like a very challenging 2020 due to the coronavirus pandemic. In a statement, Thomas Rabe, Chairman and CEO of Bertelsmann, emphasized: “We have taken many measures to protect our employees’ health and well-being in this coronaviruscrisis. Bertelsmann is well prepared financially. We are profitable, have high liquidity, a comfortable equity ratio, and ratings continue unchanged in the investment-grade category. The broad setup of our businesses makes us less susceptible to economic fluctuations and allows us to continue investing in our future without compromising the substance of our business.”
BMG CEO Hartwig Masuch said in a memo to staff obtained by Variety: “These results are additionally important right now because in the midst of economic turmoil caused by the coronavirus pandemic, they highlight the strength and appeal of BMG’s unique business model. At a time when many people are fearful for their future, we can be confident that we are on the right track.
“BMG was designed from the outset to wrap itself around the needs and aspirations of artists and songwriters in the digital age. We anticipated their desire for a more fair, transparent and service-driven music industry. We turned upside-down the old-style record contract in which artist effectively worked for the label. And we recognised that catalogue and established artists would become more and more important in a streaming world.
“I think we can feel confident that our approach will prevail. It is unlikely that artists are going to decide that they want unfair contacts after all. Songwriters will not be taking to the streets to demand less transparent royalty statements. And I find it difficult to imagine that anyone is going to request a worse service.”
Half of BMG’s annual revenues for 2019 (around $337 million) last year were generated in the United States, with the UK its second-strongest territory ($111 million).
The company’s strongest releases in 2019 came from artists including Jason Aldean, Blanco Brown, Keith Richards, Dido, The Cranberries, Andy Grammer, AJR and Lil Dicky.
New signings included Natalie Imbruglia, Rufus Wainwright, KSI, Huey Lewis & The News, Seeed and Richard Marx, among others. Its publishing triumphs included AC/DC, Mick Jagger and Keith Richards of the Rolling Stones, Roger Waters, Steven Tyler of Aerosmith, Bring Me the Horizon, Juice WRLD, 21 Savage, Johannes Oerding and Lewis Capaldi.
