| 15 Apr 2024
Universal Music's first quarter was affected by COVID-19 pandemic

MUMBAI: According to the research, Universal Music Group’s recorded music revenues grew more than 13% to $1.56 billion and its streaming revenues reach nearly $1 billion, up 16.5% year over year. The results were posted as part of the quarterly earnings for its parent company, Vivendi.

The company’s overall revenues - also including music publishing and its Bravado merchandise division - hit $1.95 billion, up 12.7%, according to Music Business Worldwide. Quarterly physical sales dipped slightly (-1.4%) to $216 million and licensing revenues rose 7.4% $210 million.

Publishing saw revenues of $298 million, up 17.7%. Merch and other revenues were down 5% year over year, due to a lower number of UMG artists on tour compared with the previous year, even before the pandemic brought the live-entertainment industry to a halt.

The company’s big sellers for the quarter, which closed at the end of March, included Japanese boy band King & Prince, Billie Eilish, Justin Bieber, Eminem and The Weeknd.

“Vivendi’s revenues for the first quarter of 2020 were little affected by the consequences of the COVID-19 pandemic, the impact of which varied according to the Group’s businesses and the geographical regions in which it operates,” Vivendi said in a statement. “A decline in revenues was recorded for certain business activities in March, notably by Havas Group, Editis and Vivendi Village, corresponding to the first effects of the COVID-19 crisis.”

Even though UMG chairman/CEO Lucian Grainge spent several weeks in the hospital, seriously ill with COVID-19, music was not one of the businesses that Vivendi singled out as being affected by the pandemic, which included advertising agency Havas Group, publishing group Editis and live-entertainment wing Vivendi Village.

“Each of Vivendi’s businesses is closely monitoring the current and potential effects of this outbreak,” the statement reads. “At this point, it is impossible to determine with certainty how long it [the pandemic] will last and how it will impact Vivendi’s revenues and annual results. The impact of the virus on the music industry should be clearer in the second-quarter of 2020”.

The statement also addressed the recent 10% acquisition of Universal Music by a consortium led by Tencent Holdings, as well as the apparently still-planned IPO of at least a portion of UMG’s business.

“Vivendi is very happy with the arrival of the Tencent-led consortium. It will enable UMG to further develop in the Asian market. Now that this very significant strategic transaction has been completed, Vivendi will pursue the possible sale of additional minority interests in UMG, assisted by several banks which it has mandated”.

“An initial public offering is currently planned for early 2023 at the latest. Vivendi intends to use the proceeds from these different transactions for substantial share buyback operations and acquisitions”.