Warner Music Reports Q4 Revenues Down 13.3%

Edgar Bronfman Jr.

WARNER MUSIC GROUP has reported its fourth-quarter and full-year financial results for the period ended SEPTEMBER 30th, 2010. For the quarter, revenue declined 13.3% to $752 million from $867 million in the prior year quarter, and was down 11.8% on a constant-currency basis. The company’s revenue results "continue to reflect the transition from physical to digital in the recorded music industry where increases in digital revenue have not yet fully offset the declines in physical revenue," wrote WMG.

Revenue from the company's Recorded Music business declined 13.3% from the prior year quarter to $619 million, and 12.2% on a constant-currency basis. "The decline reflected weakness in the U.S., JAPAN and most of EUROPE, partially offset by strength from both local and international artists in the U.K., ITALY and GERMANY," wrote WMG.

Digital revenue of $197 million grew 7.1% over the prior-year quarter on both an as reported and constant-currency basis. Digital revenue was up 10.1% sequentially from the third quarter of fiscal 2010, or 9.4% on a constant-currency basis, and represented 26.2% of total revenue for the quarter.

International revenue fell 10.0%, or 7.4% on a constant-currency basis, while domestic revenue declined 17.2%.

Music Publishing revenue declined 12.9% from the prior-year quarter to $142 million, and was down 10.1% on a constant-currency basis. International Music Publishing revenue decreased 1.2% on an as-reported basis, and grew 5.1% on a constant-currency basis, to $83 million, while domestic Music Publishing revenue declined 25.3% from the prior-year quarter to $59 million.

"Our work to diversify revenue, and conservatively manage our costs, continues to help minimize the industry’s ongoing recorded music pressures," said Chairman/CEO EDGAR BRONFMAN, JR. "We generated strong yields on our artist investments, including our highest U.S. quarterly total album share in 14 years. Our digital and non-traditional revenue grew to a combined nearly 40% of total revenue in the quarter."

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