Sony Music Entertainment posted revenues in excess of $1bn in its Q1 – the three months to end of June – despite recorded music sales falling year-on-year.
The weak Yen helped the Japanese company convert currency into that of its home country.
Revenues increased 8.5% year-on-year to 130.2bn Yen ($1.07bn), but these were down 3% at constant currency.
SME – which is comprised of Sony‘s recorded music operation, its 50% stake in Sony/ATV and its ‘visual media and platform’ division – primarily blamed the fall in music sales on ‘the continued worldwide contraction of the physical music market’.
Best-selling titles included Meghan Trainor’s Title, Shogo Hamada’s Journey of a Songwriter and Francis Cabrel’s In Extremis.
SME’s Operating income increased 20.1 billion Yen year-on-year to 31. 8 billion yen (260 million U.S. dollars).
This increase, up a mad 174%, was primarily due to the 151 million U.S. dollar (18. 1 billion yen) gain on the remeasurement to fair value of SME’s 51% equity interest in The Orchard.
This had previously been accounted for under the equity method, but was altered as a result of SME increasing its ownership interest to 100%.
The operations of Sony’s disc manufacturing business in Japan are now included in the Music segment, and the division’s results have been adjusted to accommodate the change.
As you can see below, in terms of external sales (removing any internal transactions), Sony’s recorded music division’s revenue stood at 89.3bn Yen in Q1, up from 79.4bn the year before.
Sony/ATV’s income stood at 35.6bn Yen in Q1; Sony’s 50% stake resulted in 17.8bn Yen income in the three months.
Again, thanks to currency exchange between the strong US dollar and weak Yen, this was up year-on-year from Q1 2014’s 16.3bn Yen haul.
Music Business Worldwide
