Major blames album release roll-out.
Despite strong performances from the likes of Janet Jackson, Hikaru Utada, Chingy and Bob Seger, EMI Group said today (Oct. 16) it anticipated a drop in first-half revenue.
Total revenues for the six-months ending Sept. 30 are expected to come in 3% below the same period last year. Group revenues are expected to slip 5% when taking exchange-rate movements into account.
In a trading update issued this morning to the London Stock Exchange, EMI blamed the downturn on an album release schedule geared toward the second period of its financial year.
"The year-on-year decline in revenues is due to the phasing of EMI Music's planned release schedule which, as previously indicated, has a greater weighting to the second half of the financial year than in prior years," EMI said. Stock in EMI was up 1% in morning trading to 272.75p.
On a constant currency basis, the group said its recorded music division was likely to report a 4% slide in revenue over the period. The divisional operating margin is expected to be about 3%.
Its music publishing division, meanwhile, is projecting first-half revenues level with the year-before figure. The divisional operating margin is expected to increase to about 25%.
Digital music continues to play an increasingly-critical role in EMI's business.
Sales from digital formats in the first half represented approximately 9% of revenues from EMI Music, the company's recorded music arm.
EMI expressed confidence that its overall fortunes would improve for the full financial year. "The planned artist releases, continued growth in digital revenues and delivery of the announced cost savings, are expected to drive strong growth in underlying revenues and profits in the second half of the financial year," the company said in its statement.
The highlights of its upcoming release schedule includes albums from Norah Jones, Robbie Williams, Keith Urban, Joss Stone, and a Beatles release which contains works that appear in the Cirque du Soleil "Love" show in Las Vegas.