Read Sir Lucian Grainge’s first statement to investors as the CEO of a publicly-traded Universal Music Group


Universal Music Group (UMG), the world’s greatest music rights-holder, listed on the Euronext Amsterdam Stock Exchange on September 21 with a gap valuation of $54.3 billion.

Today (October 27), simply over a month on from UMG’s blockbuster IPO, all eyes are on the music firm once more, as it proclaims its first ever monetary outcomes as a publicly-traded entity, for the three months to finish of September (Q3).

As reported by MBW earlier immediately, UMG delivered one other bumper set of quarterly outcomes.

Across all of its divisions (together with recorded music, publishing and extra), UMG noticed revenues in the three months to finish of September (Q3) of €2.153 billion (approx. $2.5bn at present alternate charges).

That was up 17.4% YoY at fixed foreign money, and up by 6.5% on the €2.022 billion revenues UMG posted in the prior quarter (Q2).

In addition to submitting its first monetary outcomes immediately, the firm performed its first ever earnings name as a publicly-traded firm, on which Executive Vice President of Digital Strategy Michael Nash and EVP, Chief Financial Officer Boyd Muir have been grilled about UMG’s outcomes.

On the name, UMG Chairman and CEO Sir Lucian Grainge addressed investors himself, throughout opening remarks through which he hailed the “beginning of a new wave of growth and evolution” in the music business.

Read Sir Lucian Grainge’s deal with in full, under:

Sir-Lucian-Grainge, Universal Music Group

I’m delighted to be right here with you for this, our very first earnings name with Universal Music Group as a public firm.

Let me start by setting the context with a basic reality. Music is on a stunningly highly effective trajectory.

For instance, simply final week, The IFPI, the international [recorded music] commerce affiliation, issued a report underscoring what we see day by day in the market  about music’s rising affect. After surveying greater than 40,000 music followers in 20 nations, the report discovered that common [per person] listening grew to 18.5 hours a week, the equal of 368 songs per client. And over the previous two years, the quantity of time followers spent on subscription audio streaming rose by 51%.

When you mix this elevated time with additional penetration of streaming monetization in each developed and high-growth music streaming markets, it’s simple to perceive our optimism about business development.

People aren’t solely having fun with extra music than ever earlier than, they’re additionally connecting with artists in ways in which have been unimaginable simply a few years in the past. A various combine of musical genres are delighting followers throughout an increasing panorama that features short-form video, social networks, health apps, gaming, dwell streams, digital items and way more.

And even as all that’s going down, the demand for bodily merchandise continues to develop. This increasing music consumption panorama means increasing music monetization. In a couple of minutes, Boyd [Muir] might be addressing our monetary leads to extra element. But for now, listed here are two highlights for the quarter simply ended.

All segments contributed to a 17% income development [at UMG], in contrast to the prior yr quarter and to a rise [in margin to] 21% of adjusted EBITDA.

We really feel that these numbers communicate for themselves. Looking forward, we imagine there may be unprecedented alternative for additional development. Given that followers now have entry to primarily all of the world’s music in the palm of their palms, and that client demand for music throughout cultures, eras, languages, and genres is at historic highs, I stay unwavering in my confidence that the path we’re on will lead us on to larger heights.

As somebody who’s been in the enterprise for his whole profession. I can let you know that development like this doesn’t simply occur. It begins, as of course it should, with nice music from gifted artists and songwriters. But from there, it takes arduous work by impressed professionals and funding by corporations like ours to develop and broaden the whole music system.

But make no mistake, there actually are not any different corporations like ours.

“UMG is the driving force of progress and innovation in the industry, at a time when the music market seemingly has no barriers to entry.”

UMG is the driving pressure of progress and innovation in the business, at a time when the music market seemingly has no boundaries to entry. When anybody wherever can document and distribute audio content material. And when each single day, roughly 60,000 tracks are uploaded to Spotify alone, the actuality is it’s more durable than ever for artists to lower by way of all of the noise to discover and develop their viewers.

That is strictly why we place the utmost precedence on maximising alternatives for artists to convey their music to the world and to join with followers in more and more wealthy methods. When we assist artists break by way of to business success, we’re additionally empowering them to attain new ranges of creative creativity and to go on to hopefully develop actually sustainable careers. By prioritizing our give attention to artist improvement, and constantly delivering larger alternatives for artists’ success.

We stay the vacation spot of alternative for these artists in search of a associate that each shares a long-term, career-oriented imaginative and prescient and has an unmatched observe document to show it. As I mentioned, we’re uniquely positioned to drive the best worth, primarily based on our international assets and advertising expertise. That merely is why the world’s best artists of each stage of their profession, proceed to signal, renew and develop their partnerships with UMG.

Let me spotlight some developments this quarter with a few of our artist partnerships.

Last month, Germany’s most profitable music artist, Helene Fischer, extended her partnership with Universal Music Germany. Fischer has topped Germany’s annual gross sales charts for 5 of the final eight years, greater than every other artist in German chart historical past. Her new studio album, Rausch, debuted on October 15, is already this yr’s fastest-selling album [in the market]. In August, we entered into an in depth worldwide alliance with Aerosmith, the finest promoting American arduous rock band of all time.

“We are uniquely positioned to drive the greatest value, based on our global resources and marketing experience.”

That [deal] contains their whole discography, merchandise and audiovisual initiatives. We couldn’t be extra excited to unite the work of this iconic group at UMG forward of their upcoming fiftieth anniversary. For the first time, all of Aerosmith’s unbelievable recordings might be marketed and distributed completely by one firm: us.

As a signal of the really nice international nature of UMG’s enterprise immediately, in July, we have been thrilled to sign an exclusive global agreement with Indian music celebrity and entrepreneur Badshah. With greater than 15 billion streams worldwide, he’s a dynamic Delhi-born rapper, singer, and music producer, and is one of the world’s hottest musical artists.

Our multi-year settlement embraces all components of his profession, together with future recordings, music publishing rights for non-film compositions, model licensing and partnerships. He’s a most welcome addition to our household.

We additionally introduced a new settlement with one of the world’s most acclaimed artists, a number of Grammy winner Andrea Bocelli.  And just final week, BTS – the world’s primary finest promoting group, in accordance to the IFPI – introduced that they are going to be increasing their relationship with UMG, partnering with us globally, together with in the US.

Earlier I discussed our long-term, career-oriented method to artist partnerships, an method that additionally contains discovering revolutionary methods to introduce legendary artists’ music to new generations. This quarter, I can cite no higher instance than ABBA, one of the most profitable pop teams of all time. ABBA just lately introduced the upcoming UMG launch of their first studio album in 40 years – and we’re additionally partnering with the band on a revolutionary kind of live performance.

Next yr the group will carry out as avatars in an immersive digital live performance expertise with a dwell 10-piece band in an enviornment in London. The information of the upcoming live performance took ABBA’s again catalog to the prime of the streaming charts and gained them, in only one week, over a million followers on TikTok alone.

“Because UMG has today’s most popular artists and hits as well as the world’s deepest and why this catalog, we are in a unique position to deliver the essential content and platform engagement new digital businesses seek, in order to accelerate their business models.”

There’s one more method through which we’re the business’s driving pressure: Because UMG has immediately’s hottest artists and hits as properly as the world’s deepest and widest catalog, we’re in a distinctive place to ship the important content material and platform engagement [that] new digital companies search, so as to speed up their enterprise fashions.

Our place inevitably leads us to focus relentlessly on the future; and we do. I’ve [already] described music as changing into an indispensable ingredient in a big selection of media, short-form video on social networks, match tech, gaming, and so on. Music is in every single place immediately. And it will likely be in every single place in the future, as innovation drives market transformation and the panorama retains increasing.

Looking at well being for instance, the place we’ve promoted thrilling new purposes in music licensing inside health providers, we’ve now established a partnership that harnesses music as a key part of medical remedy. Something which I’m notably enthusiastic about.

We just lately partnered with a digital therapeutics firm, Medrhythms, our first deal in the medical space. And the first deal of its variety in the business, for the use of our catalog is first prescription music to stimulate components of a affected person’s mind.

This is only one instance that factors to the ever increasing scope of the music enterprise panorama. We are additionally fostering revolutionary new partnerships in social media constructing on the strong basis of our business main strategic relationships with YouTube, Facebook, Instagram, TikTok. Over the final 4 months, we now have accomplished new offers with SNAP, Lomotif and Kuaishou.

We’re increasing our social media partnership portfolio with revolutionary providers that additional lengthen engagement and monetization alternatives for our artists with fanbases round the world.

Another space the place we intensely centered and have bolstered our efforts is the manufacturing of unique movie and TV content material. This is a key side of our means to promote our IP exterior of the conventional realms of music.

Our success on this enviornment was already evident at the latest 2021 US Emmy Awards: UMG’s PolyGram Entertainment garnered 11 nominations, with the Bee Gees How Can You Mend a Broken Heart receiving six nominations and profitable one Emmy.

Polygram Entertainment’s Zoey’s Extraordinary Playlist acquired 5 nominations; Interscope’s movie Billie Eilish: The World’s a Little Blurry acquired 4. And in July, The Velvet Underground documentary premiered at the Cannes Film Festival to rave critiques earlier than opening final week each theatrically and on Apple Plus.

“I firmly believe the music industry is only at the beginning of a new wave of growth and evolution. We’re positioning UMG to lead this evolution for the benefit of our artists, fans, [and] obviously shareholders.”

While we’re speaking about awards, I’d be remiss not to point out a few exceptional chart statistics as properly.

Through the third quarter of 2021, in accordance to MRC Data, in the US UMG has all of the prime 4 albums [of the quarter] – from Morgan Wallen, Olivia Rodrigo, Pop Smoke and Justin Bieber, as properly as the No.1 album for 33 of the 39 first weeks of the yr. [That’s] as properly as all of this yr’s Top Seven [biggest] debut weeks, from Drake, Kanye West, Olivia Rodrigo, Taylor Swift, J. Cole, Morgan Wallen and Billie Eilish. In the UK, in accordance to the Official Charts Company, to date this yr, we now have eight of the Top 10 artists [plus the year’s] prime album, with Olivia Rodrigo Sour and three of the prime 4 singles.

On Spotify’s Global chart, Olivia had the No.1 tune by way of the third quarter of 2021, remaining in that spot for 45 consecutive days.

This is simply a small pattern of what is occurring round the world at Universal Music Group. I’m proud of all that we’ve finished to convey us to this level and specifically, what we’ve completed this quarter.

Let me guarantee you, our imaginative and prescient stays far reaching and our technique is, and all the time might be, long run.

I firmly imagine the music business is simply at the starting of a new wave of development and evolution. We’re positioning UMG to lead this evolution for the profit of our artists, followers, [and] clearly shareholders. Thank you.Music Business Worldwide

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