Music publishing’s popularity with investors makes Hipgnosis Songs Fund the "it" company in the music business right now. Guernsey-incorporated Hipgnosis is a pure-play music option for investors interested in the asset class -- no merchandise, no concert promotion, just music publishing royalties with a touch of recorded music income.
Publishing royalties remain strong while some segments such as live music get pummeled by the pandemic. Global streaming growth more than compensates for the declines in performance royalties from radio and live performances. A noticeable jump in Hipgnosis’s mid-year financials for April 1 to September -- all year over year -- were boosted by the purchase of 63 catalogs and 44,500 songs, many from acquisitions of music publisher Big Deal Music in September. Here are the top takeaways:
- Revenue increased 121% to £50 million ($67.1 million).
- Net operating income increased 92.9% to £44.8 million ($60.2 million)
- Net profit decreased 4.4% to £10.3 million ($13.8 million)
- Mechanical income rose 242.7% to £4.8 million ($6.4 million)
- Synchronization income increased 240.1% to £6.9 million ($9.3 million)
- Streaming revenue grew 74.2% to £8.1 million ($10.9 million)