Hipgnosis Songs Fund saw a 24.7% year-over-year (YoY) improvement in gross revenue in the fiscal year ending March 31, 2022. But gross debt was $600 million dollars at the end of the period, and the company’s earnings per share ended at -1.65 cents.
The Hipgnosis Songs Fund revealed these and a variety of other performance details today, in a full account of its broadcast during the 2021-22 financial year. The fund, it should be noted from the outset, is the publicly traded entity (LON:SONG) that has lost billions on song catalogs in recent years.
The fund’s “investment adviser”, Hipgnosis Song Management, is a separate operation in which Blackstone has a stake. Despite the separate nature of the companies’ respective efforts — and the fund’s dwindling catalog purchases — the adviser researches songs and provides “recommendations” to publicly listed company Hipgnosis in exchange for an “advisory fee.”
These advisory fees totaled $16.5 million in the last fiscal year (compared to $11.5 million), while a “performance fee” amounted to $0 for the new fiscal year ended (when catalog buybacks were relatively rare, again), but at $534,000 for the prior year. AF.
Higher advisory fees contributed $38.4 million in adjusted operating costs, less debt interest payments, for Hipgnosis for the year (vs. $32.4 million), and the fund also disclosed that it spent $1.95 million on ultimately abandoned deals during the year (from $848,000).
In terms of other expenses — besides the $265.1 million total for eight catalogs, the most notable being those of Fleetwood Mac’s Christine McVie and the Red Hot Chili Peppers — Hipgnosis said the interest on its loan had passed. from $7.3 million to $20.4 million this fiscal year. , while gross debt peaked at $600 million. (The company “is reviewing its debt structure with a view to reducing interest rate risk and controlling costs.”)
Nevertheless, Hipgnosis also reported that gross revenue jumped 24.7% year-on-year to $200.38 million, while net revenue recorded a 21.7% year-on-year improvement to $168 million. $3 million. Consistent with the latter, EBITDA in the 12 months ending March 31, 2022 achieved a year-over-year increase of 21.8% to $129.9 million.
Finally, in terms of specific revenue details for the fiscal year, “public relations expenses” rose from $36,000 to $702,000, and executives attributed the mentioned EPS drop to “the impact of ‘a higher RTI’. [right to income] the previous year,” increasing from $66.6 million to $17.97 million in fiscal year 2021-22.
Elsewhere in the voluminous report, Hipgnosis founder Merck Mercuriadis touted the perceived long-term potential of streaming, even with the tough economic climate; Having more than doubled to $72.85 million in fiscal 2022, streaming was by far the highest earning category for Hipgnosis.
Additionally, the company highlighted a number of sync deals involving its work on the 12-month window, which brought in $22.53 million in sync revenue (vs. $28.02 million during of the 2020-21 financial year).
Additionally, Hipgnosis said it had 146 catalogs, comprising 65,413 songs, as of March 31. The “aggregate fair value” of the holdings, as determined by the company’s “independent portfolio appraiser,” Citrin Cooperman, was $2.69 billion on the 31st, a year-on-year gain of 9.5% .