BMG global revenues up 9% in half-year results

BMG’s revenues grew 9% in the first half of 2021 to €296 million (AUD$477.8 million).

The figures, calculated YoY at constant currency, showed “BMG’s best first half yet” since it was set up in 2008, according to CEO Hartwig Masuch.

By comparison, it generated €282 million ($374.5 million) in the first six months of 2020.

Masuch added: “While publishing revenues continue to reflect the impact of lockdown and were flat, in recordings revenues were up 29.4% on the same period last year.

“We outperformed the market in both digital and physical in each of our three core markets of the US, UK and Germany.”

The US market generated €160 million ($258.2 million), the UK was €45 million ($72.6 million) and Germany €19 million ($30.6 million).

During the January to June period, publishing made up 62.9% of revenue and recordings were 37.1%.

Biggest-selling acts this year were German rapper Kontra K, KSI, Garbage, Jason Aldean, Joan Armatrading, Van Morrison and AJR.

Recent signing Duran Duran this morning dropped a new single ‘Anniversary’ in Australia, from the October 22-due Future Past album.

Other fresh additions to the recording roster were Louis Tomlinson, No Angels, Santana, Bryan Adams and Soft Cell.

Streaming remains BMG’s foremost format, at 65% of revenue. For the first time, vinyl overtook CD in the physical stakes.

This year, BMG went into partnership with global investment firm KKR to go on the acquisition hunt.

The first has just been finalised, with four more in the due diligence stage. The company is looking at a total of 71 deals, worth over €1 billion ($1.61 billion).

This year BMG also struck deals with Netflix to manage its music publishing rights outside the US, and with gaming platform Roblox to develop new opportunities for artists and songwriters.

According to Masuch, BMG’s appeal to major artists and brands was a testament to its culture of fairness and transparency.

The company won kudos from industry trade bodies for its ‘fairness’ agenda, to make contracts more artist friendly.

These included removing caps on total royalties paid on an album and packaging deductions from digital royalty payments, and a review of all its recorded music catalogues to address historical injustices inflicted on Black artists.

“We were correct in our view that in a streaming world, music companies needed to abandon their old ways (hence our fairness agenda),” he wrote.

“We were correct in our analysis that a streaming world is a catalogue-dominated world (hence our repertoire strategy).

“We were right that the influx of investor funds into music would reshape the market forever (hence our alliance with KKR).

“We should not kid ourselves that others won’t reach the same conclusions, even if a little more slowly.

“We need to constantly stay ahead of them, adjusting course as necessary.

“One thing I am confident they cannot copy, however, is our spirit – our commitment to work for artists and songwriters rather than at their expense.”

During the pandemic, BMG increased its global workforce by 255 to 1,001.