DIGITAL DRIVES RECORD YEAR FOR WARNER MUSIC

Streaming revenue approached $1 billion at Warner Music Group in fiscal 2016, as the company saw a 13.1% total revenue increase to $3.25 billion in the year that ended 9/30/16. Digital revenue grew 24.3% in constant currency, representing 46.2% of total revenue.

"This fiscal year marked our highest total revenue in eight years and our highest OIBDA in a decade,” said WMG CEO Stephen Cooper.

Globally, recorded music revenue rose 12.9% to $2.74b in constant currency with streams and downloads responsible for half of the income. Domestic recorded music digital revenue was $714 million, or 63.2% of total domestic recorded music revenue.

Besides noting the company’s revenue was the highest it has been in eight years, Cooper noted in a conference call that the company had benefited from a strategy of releasing a consistent flow of music to reduce the dependence on the labels’ biggest hits.

The Top 10 sellers of fiscal 2016 represented 8% of total sales, Cooper said, down from 12% in fiscal 2015. He also touted the company’s investment in new studios and writing rooms as well as expanded global operations in areas such as Latin America and Asia.

Music publishing revenue rose 13.4% in constant currency to $524m as growth in digital revenue, performance revenue and synchronization revenue was partially offset by declines in mechanical revenue. Publishing operating income, however, was down nearly 12% to $68m.

For the first time since Len Blavatnik’s Access Industries acquired the company in 2011, the company is issuing a dividend, which they termed a “modest” $50 million.

In the fourth quarter, revenue grew 13.2% in constant currency to $841m. The company saw growth in digital revenue at recorded music (up 20% to $366m) and music publishing (up 68% to $47m) and declines in physical revenue and mechanical revenue.