Reservoir generated $107.8m in its first year as a public company – and spent over $224m across 110 deals

reservoir Media just ended its first fiscal year as a publicly traded company.

New York-based Reservoir – where floating on NASDAQ through merger with SPAC July 2021 – announced its financial results today (June 21) for Q4 of fiscal year 2021 (calendar Q1 of 2022) and fiscal year of 2022, ending March 31, 2021. 2022.

Results for the whole year

According to Reservoir’s SEC filing, the company’s total revenue (including recorded and published music) in fiscal year 2022 increased 34% arrive $107.8 millionfight with $80.2 million in fiscal year 2021.

On an organic basis (i.e. discounting acquisitions), Reservoir says its overall revenue has increased 15% in year.

Why the big difference? Because Reservoir today also revealed that it’s rolled out more 224 million dollars contributed capital in 110 deals in the first year as a public company, of which eighty seven% has focused on portfolio acquisition.

That $224 million is a larger rollout than the annual spending target associated with Reservoir’s original deal. 200 million dollars.

Some 100 million dollars among them 224 million dollars figure spent on the acquisition of Tommy Boy Records, which Reservoir bought for $100 million in June 2021.

(In Reservoir’s new annual report for fiscal year 2022, the company writes: “In the ordinary course of business, [Reservoir] regular purchases of published and recorded music catalogs, often counted as asset acquisitions. For the financial years ending March 31, 2022 and 2021, [we] completed a total of such acquisitions $202,067.308 and $115,227,517respectively, including deferred conversion payments.)

“Ultimately, Reservoir is positioned to thrive through turbulent times due to its recession-proof business model, and this resilience is partly due to the fact that music remains one of the least profitable forms of entertainment. ”

Golnar Khosrowshahireservoir

According to Reservoir founder and CEO Golnar Khosrowshahi, Reservoir’s system of potential upcoming deals is “still going strong.”

Khosrowshahi added that her firm is expected to “deploy over $100 million in new capital by fiscal year 2023 that will help us further expand and diversify our portfolio”.

“While our acquisition path presents a clear growth opportunity, Reservoir also continues to outperform the industry in terms of speed,” Khosrowshahi told analysts during an earnings call earlier today. organic growth.

“We remain very confident that we can sustain this as Reservoir is insulated from broader market pressures through having an asset class that is unrelated to the usual macroeconomic trends. impact on other businesses.”

She added: “Ultimately, Reservoir is positioned to grow through turbulent times due to its recession-proof business model, and this resilience is partly due to the fact that music remains one of the forms of entertainment. make the least money.”

Reservoir’s Music publishing revenue for fiscal year 2022 (months to end of March) reached 77.1 million dollarsget a raise 17% compare to $66.1 million in fiscal year 2021.

And Reservoir’s recorded music revenue for the fiscal year 2022, which ends March 31, has increased. 126% YoY comes $29.5 millionfight with 13.1 million dollars in fiscal year 2021 (see below).

Q1 Calendar / Q4 fiscal results

Total Reservoir revenue generated in fiscal Q4 (calendar Q1 2022) has increased forty six% arrive $35.1 millionfight with 24.1 million dollars in the quarter of the previous year.

Revenue from Music Publishing generated by the company in Q1 increased 29% from year to year 25.1 million dollarscompare to 19.4 million dollars according to the Q1 calendar, in 2021.

Meanwhile, revenue from Reservoir’s Recorded Music increased 123% by year arrive $9.8 million in the Q1 calendar, compared to 4.4 million dollars in the last quarter – again, largely thanks to last year’s acquisition of Tommy Boy Records.

Some of Reservoir’s acquisitions since the company’s successful emergence on the NASDAQ exchange in July 2021 include:

• A raft of songs by country musicians Stephen Smith for an undisclosed fee (in November).
• Hit Songs by the Platinum Best-Selling Producer and Musician Dallas Austin (November).
• Bets in the publishing catalog of Fred Parris, writer, vocalist and founder of the doo-wop group The Five Satins (December).
• Publishing catalog of Grammy Award-winning DJs, songwriters and producers Fred Lister (in January 2022).
• Publishing and cataloging of country music stars Travis Tritt (January 2022).

During the first quarter of the calendar year, Reservoir completed portfolio acquisitions, including Larry Smith, Henry Jackmanand Larry Kusik.

The company has also signed multiple publishing and futures contracts over the past few months, including Ali Tamposi, Killer Mike and others.

Elsewhere in Reservoir’s latest filing, the company reported that its operating income was $8.7 million for the calendar quarter, up 28% from operating income of $6.8 million. dollars in the previous quarter.

OIBDA (Operating Income Before Amortization & Amortization) for the first quarter of 2022 increased 34% year-over-year to $13.9 million, compared with $10.4 million in the previous quarter.

Adjusted EBITDA for the calendar quarter rose 47% to $15.4 million, compared with $10.5 million last year.

Reservoir reported that the increase in operating income, OIBDA and adjusted EBITDA was primarily driven by double-digit revenue growth from both recorded music and music publishing and was “compensated” covered by the costs associated with becoming a public company that did not exist prior to the year”.

“As we close out our first year as a publicly traded company, we are proud to announce that we have outperformed our expectations and exceeded our growth target. capitalized with $224 million deployed across 110 unique transactions.”

Golnar Khosrowshahi, Reservoir

Golnar Khosrowshahi, Founder and CEO of Reservoir, said: “We are pleased to report very positive results for our fourth fiscal quarter, which is close to a record year for Reservoir. We deliver on our financial commitments, driven by strategic investments, and continue to execute on our strategy of building a strong, curated and diversified portfolio of the works of award-winning musicians and artists,”

Khosrowshahi added: “As we conclude our first year as a publicly traded company, we are proud to announce that we have outperformed expectations and exceeded our growth target. capital deployment with $224 million deployed across 110 unique transactions.

“More importantly, we have laid the groundwork for future growth by significantly expanding and diversifying our list, while we remain proud of our place in the music industry. music as a trusted partner that can drive value for our talented artists.”

Khosrowshahi continued: “Going forward, our focus remains on growth, driven by continued execution of our M&A process, as well as through value-adding initiatives. leader in our industry.

“Our pipeline of potential deals remains strong and we expect to deploy over $100 million in new capital in FY 2023 which will help us further expand and diversify our portfolio. its investment. We expect to continue to deliver consistent and predictable results in fiscal year 2023, supported by a flexible and cash-generating business model.

“We look forward to leveraging our brand and growing position in the music industry and believe we have a strong platform and strategy to drive long-term growth.”

“Given the momentum we have built in fiscal 2022, including many new additions to our growing talent pool, we expect to continue to drive strong growth in both our profit and year-end profit.”

Jim Heindlmeyer, Reservoir

Jim Heindlmeyer, Reservoir’s Chief Financial Officer, said: “Given the momentum we’ve built in fiscal 2022, including numerous new additions to our growing talent pool, we look forward to is expected to continue to drive strong growth in both profit and profit next year.

“This growth will be supported by the predictable cash flows that our robust business model generates.

“Our business model has proven resilient over historical economic cycles, and we have the right strategy in place to drive long-term value creation for our innovative partners. , the business and for our shareholders.”Worldwide music business