Universal Music Group N.v. · EURONEXT:UMG
Universal Music — Q2 2022 Earnings Presentation
21 slides from Universal Music's earnings presentation, Jul 27, 2022
Slide 1: Second Quarter & First Half Ended June 30, 2022
07 27 SECOND QUARTER & FIRST HALF ENDED JUNE 30, 2022
Slide 2: Important Information
IMPORTANT INFORMATION Forward Looking Statements This presentation contains statements that may constitute forward-looking statements relating to the business, financial performance and results of Universal Music Group N.V. (the “Company”) and the industry in which the Company operates. These statem
Slide 3: Sir Lucian Grainge, Chairman & CEO
SIR LUCIAN GRAINGE CHAIRMAN & CEO UNIVERSAL MUSIC GROUP
Slide 4: Increasingly Diversified Revenue Growth
INCREASINGLY DIVERSIFIED REVENUE GROWTH 2Q 2022 1H 2022 REVENUE REVENUE +17% +17% VINYL SUBSCRIPTION D2C LICENSING STREAMING RETAIL MERCH SYNC CDs CONCERT MERCH E-COMMERCE Notes: All growth rates are in constant currency.
Slide 5: Strong Performance Fueled by Deep Partnerships with Artists
STRONG PERFORMANCE FUELED BY DEEP PARTNERSHIPS WITH ARTISTS AT ALL STAGES OF THEIR CAREERS OLIVIA FRANK DRAKE BTS RODRIGO ZAPPA Honestly Nevermind 11th No. 1 Double Digit Growth in Album in U.S. 21st Century’s Longest Streams Every Year for Running Debut Album Last Decade with UMG “Jimmy Cooks” 11th
Slide 6: Increasing Catalog Value Through Original Film & TV Production
INCREASING CATALOG VALUE THROUGH ORIGINAL FILM & TV PRODUCTION
Slide 7: Sir Lucian Grainge, Chairman & CEO
SIR LUCIAN GRAINGE CHAIRMAN & CEO UNIVERSAL MUSIC GROUP
Slide 8: UMG Is Leading the Evolution of the Industry's Digital Partnerships
UMG IS LEADING THE EVOLUTION OF THE INDUSTRY’S DIGITAL PARTNERSHIPS EXPANDING INDUSTRY-FIRST PARTNERSHIP WITH META 2017 2022 Q4 2017 Q4 2018 Q4 2019 Q3 2020 Q2 2022 Landmark UMG Facebook Launches Music Facebook Music adds dozens of Reels on Instagram UMG & Meta Renew Music Partnership Forged for Pro
Slide 9: UMG for Brands & UMusic Media Network
UMG FOR BRANDS & UMUSIC MEDIA NETWORK Positions brands front and center with the Exclusive access to strategic and voices and content that drives culture culturally relevant data and content Over 100 Top Brand Partners Globally & Locally Including: UMG is No. 1 in Music & No. 2 in Entertainment Over
Slide 10: Sir Lucian Grainge, Chairman & CEO
SIR LUCIAN GRAINGE CHAIRMAN & CEO UNIVERSAL MUSIC GROUP
Slide 11: Boyd Muir, EVP, CFO & President of Operations
BOYD MUIR EVP, CFO & PRESIDENT OF OPERATIONS UNIVERSAL MUSIC GROUP
Slide 12: Q2 & H1 2022 Summary Results
Q2 & H1 2022 SUMMARY RESULTS (€ MILLION) REVENUE ADJUSTED ADJUSTED EBITDA EBITDA MARGIN Q2 2022 €2,535 €507 20.0% +17.3% YOY +8.3% YOY (1.2 PP) YOY REVENUE ADJUSTED ADJUSTED EBITDA EBITDA MARGIN H1 2022 €4,734 €962 20.3% +16.9% YOY +11.0% YOY (1.2 PP) YOY Notes: All growth rates are in constant curr
Slide 13: Recorded Music
RECORDED MUSIC (€ MILLION) 2Q REVENUE 1H REVENUE 1H EBITDA +9.0% +10.1% +6.9% 1,922 3,643 842 1,654 3,137 749 2Q21 2Q22 1H21 1H22 1H21 1H22 Notes: All growth rates are in constant currency. Q2 2021 and H1 2021 benefitted from a one-time catch-up payment from a DSP amounting to €41 million in subscri
Slide 14: Recorded Music Revenue
RECORDED MUSIC REVENUE (€ MILLION) +10.1% 3,643 3,137 +9.0% +10.0% 1,922 1,866 1,654 1,604 +7.0% +17.1% 966 +13.4% 843 +15.6% +17.4% +7.8% +6.3% 658 -16.0% 526 540 -12.7% 463 348 391 442 279 250 303 210 236 153 137 72 69 Subscription* Streaming Downloads & Physical License & Total Subscription* Stre
Slide 15: Recorded Music Revenue
RECORDED MUSIC REVENUE (€ MILLION) GEOGRAPHIC BREAKDOWN BEST SELLERS H1 2022 % Change 2Q22 2Q21 BTS BTS North America 1,821 7% King & Prince Justin Bieber Rammstein Olivia Rodrigo Europe 1,052 13% Olivia Rodrigo The Weeknd INI Morgan Wallen Asia 476 10% Latin America 146 27% 1H22 1H21 Rest of World
Slide 16: Music Publishing
MUSIC PUBLISHING (€ MILLION) 2Q REVENUE 1H REVENUE 1H EBITDA +50.6% +42.1% +39.9% 476 851 200 564 134 293 2Q21 2Q22 1H21 1H22 1H21 1H22 Notes: All growth rates are in constant currency. Q2 2022 and H1 2022 benefitted from a change in revenue recognition accounting policy from a cash to accrual basis
Slide 17: Merchandising and Other
MERCHANDISING AND OTHER (€ MILLION) 2Q REVENUE 1H REVENUE 1H EBITDA +65.9% +67.6% 14 141 248 79 138 0 2Q21 2Q22 1H21 1H22 1H21 1H22 Notes: All growth rates are in constant currency.
Slide 18: H1 2022 Net Profit and Dividend
H1 2022 NET PROFIT AND DIVIDEND (€ MILLION) ADJUSTED NET ADJUSTED INTERIM DIVIDEND PROFIT EPS PER SHARE €763 €0.42 €0.24 +32.0% YOY +31.3% YOY +20.0% YOY NET PROFIT EPS €241 €0.13 (46.7%) YOY (48.0%) YOY Notes: All growth rates are as reported, at actual FX.
Slide 19: H1 2022 Free Cash Flow
H1 2022 FREE CASH FLOW (€ MILLION) - Net advances first-half weighted in 2022 - Free Cash Flow of €104 million in H1 2022 182 (223) (119) (131) 765 (264) 474 (56) (51) 0 1 104 Operating Adjustments* Royalty advance Other Income Net cash Catalog Other investing Repayment of Interest Other cash Free C
Slide 20: Balance Sheet @ 6/30/22
BALANCE SHEET @ 6/30/22 (€ MILLION) - Baa1 (st.) / BBB (st.) by Moody’s and S&P - Issued €1.0 billion of senior unsecured notes June 2022 - Repaid €1.0 billion term loan July 1, 2022 €3,826M €1,543M €2,283M GROSS DEBT CASH POSITION NET DEBT
Slide 21: Q&A
Q&A
Universal Music Group — Q2 2022 Earnings Presentation on 6ix