While reporting a “strong set” of full-year financial results, British independent music company Chrysalis Group today (Nov. 15) signalled its intentions to enter into the artist management business.
Although details remain scarce on its artist management ambitions, Chrysalis chairman Chris Wright says the integration of an existing specialist into its music division would represent a logical strategic step. “It will be of a peripheral nature, but still hopefully big enough so that it can contribute to the group,” Wright tells Billboard.biz. “We can try and make it work for us by being involved in all aspects of an artists’ income stream.”
Wright says negotiations are ongoing with artist management firms in L.A. and London. “One deal is 90% complete, but looks like it might fall apart. Others might be announced any day,” he adds. An artist management arm would complement the group’s “virtual” label model, through which Chrysalis is planning to establish a presence in the United States early in the New Year.
But despite issuing upbeat preliminary results, shares in the London-based company slipped after it confirmed the national radio advertising market had been “volatile” in fall trading and that first quarter radio sales would be flat. Stock closed down 6.42% to 164p at close of trading today.
Earlier in the day, Chrysalis reported like-for-like operating profit in the 12 months to Aug. 31 achieved near fourfold growth to £8.3 million ($15.33 million), thanks largely to solid performances from its radio and music divisions.
Radio revenues rose 20.9% to £67.7 million ($127.7 million) during the period and earnings before interest, tax and amortisation (EBITA) increased by 48.2% to a record £14 million ($25.8 million).
When asked if the group was eyeing-up any acquisitions to beef-up its Heart, Galaxy and LBC radio brands, Chrysalis CEO Richard Huntingford refused to rule out any future purchases. “We’ll go after any acquisition that fits our radio strategy, which is about major markets and being brand led. We are not going after overpriced, underperforming assets, because all that’s going to do is dilute the overall quality of our portfolio,” Huntingford says.
The Chrysalis Music division — which comprises the company’s music publishing company, Lasgo Chrysalis’ U.K. wholesale distribution activities and the Echo record label — achieved EBITA gains of 20% to £4.6 million ($8.5 million). At the same time, sales dipped slightly to £70.6 million ($130 million).
Upcoming scheduled Echo releases include a new Feeder album “Pushing the Senses” in January, and a spring 2005 set from new signing Morcheeba, which the label recently picked up from Warner Music.