UMG Revenue Up 4.5% As Vivendi Confirms IPO, Sale Plans

Serious exploration of an IPO or the sale of Universal Music Group was confirmed by parent Vivendi during an earnings call Thursday. A Board committee has been tasked with exploring "all or a potential change in the Universal Music Group’s shareholding structure."

Highlights for Universal Music Group shared during the Vivendi earnings call include:

User growth recently reported by the major streaming platforms continues to support the strong increase in Universal Music Group’s (UMG) subscription and streaming revenues. At the end of April 2018, UMG’s revenues amounted to €1,657 million, up 7.2% at constant currency and perimeter compared to the same four-month period in 2017.
For the first quarter of 2018, revenues amounted to €1,222 million, up 4.5% at constant currency and perimeter compared to the same period in 2017 (down 4.8% on an actual basis).
Recorded music revenues were up 5.9% at constant currency and perimeter as growth in subscription and streaming revenues (+31.5%) more than offset the decline in physical (-26.2%) and download (-25.6%) sales.
Physical sales were particularly strong in the first quarter of 2017, notably driven by the soundtrack releases from La La Land, Fifty Shades Darker and Moana. For the first quarter of 2018, physical sales were also impacted by the timing of releases, with slippage into the second quarter in some markets, notably Japan, and the continued transformation of the music business.
Recorded music best sellers for the first quarter of 2018 included the Black Panther soundtrack, a new release from Migos and carryover sales from Post Malone, Imagine Dragons and Kendrick Lamar.
According to Nielsen, UMG had the No. 1 album in the United States with Migos’s Culture II and the No. 1 track with Drake’s God’s Plan in the first quarter of 2018. In addition, UMG songs occupied the No. 1 spot on the Spotify Global Chart for 12 weeks of the first quarter of 2018.
Kendrick Lamar won the Pulitzer Prize for music for his album “DAMN.”, the first win for a non-classical or jazz musician since music was first included in the awards 75 years ago.
UMG signed an exclusive international recording agreement with Kris Wu, one of Asia’s biggest stars and an artist whose creative success spans music, film and television.
'Music publishing revenues grew by 3.9% at constant currency and perimeter, also driven by increased subscription and streaming revenues, as well as better performance revenues.
Merchandising and other revenues declined by 18.7% at constant currency and perimeter, due to lower touring activity and the timing of retail promotions.