BMG revenues up 5% in first half of 2020 despite pandemic
BMG’s recorded and publishing division survived the early impact of coronavirus, posting an increase of 4.8% YoY for the first half of 2020.
According to figures from parent company Bertelsmann, BMG revenues reached €282 million (A$457.6 million), from €269 million ($436.5 million), while operating EBITDA was unchanged at €49 million ($79.5 million).
It was BMG’s best first-half result since 2008.
“Thanks to dynamic growth in music streaming, further facilitated by the company’s broad and highly digital set-up, any lost revenues due to postponed releases or disruptions of physical distribution were more than compensated for,” the company said.
Digital now makes up 59% of total revenue, compared to 56% in the same period in 2019.
In the first six months, BMG released music by UK YouTube personality-turned rapper KSI (whose star-studded Dissimulation was the biggest-selling UK debut album in that time and charted in 13 countries), hip hop act Run The Jewels, reggae star Conkarah and newcomer Kathmandu-born US based Curtis Waters.
New signings included Aloe Blacc, Jason Mraz, Run The Jewels and New Zealand rapper CHAII.
“To deliver a record result in the midst of a pandemic is a remarkable achievement,” BMG CEO Hartwig Masuch said.
It is a testament to our artist-centric business model, but also to our 926-strong team worldwide who went to extraordinary lengths to maintain service to our artist and songwriter clients.
Highlights for BMG’s publishing business included Tame Impala, Lewis Capaldi, Blossoms, Ufo361 and Nav.
New signings by the division were Erika Ender, Diane Warren, Runaway June and Patricia Kelly, while The Rolling Stones recorded their first new song in eight years, ‘Living In A Ghost Town’.
In the period, BMG also signed global partnerships with UK-based international TV production and distribution company ITV Studios to cover its music content and feature more BMG acts in its productions, and late Beatle George Harrison’s Dark Horse Records label, which is now run by Harrison’s son Dhani Harrison and manager David Zonshine.
“Our growth is almost entirely organic. Despite the high levels of M&A in the wider music industry, we have not made a major acquisition since 2017,” Masuch added.
“Our focus is on growing by delivering better, fairer, more efficient services to artists and songwriters.
“There is no doubt musicians are hurting through the pandemic, particularly with the loss of live business. That puts a particular responsibility on record labels and music publishers to help artists and songwriters maximise their earnings.”
BMG increased its range of artist services with a move into the neighbouring rights business and a new feature on its myBMG service portal that enables artists to work together with songwriters on creative projects during the lockdown.
It also expanded into Canada’s production music sector, and launched the Americana-themed Renew Records label based in Los Angeles.
A partnership with the AI-based music-to-video platform MatchTune, which makes it easier to source music for video, and edit and synchronise that music into the video itself, made 15,000 tracks from BMG Production Music libraries available to the platform.
Bertelsmann itself faced a single-digit percentage decline in revenues, to €7.8 billion ($12. 6 billion) with group profit of €488 million ($792 million) near previous-year’s level.