Even without AWAL, Kobalt Music Group is still a $600 million+ annual business…and comfortably profitable.

Kobalt music group has done a number of notable sell-offs over the past year.


So without these corporate banner areas – namely AWAL and the Right Neighbor Kobalt, both sold to Sony ten months ago in a $430 million deal – just how big a business is just shortened Kobalt in 2022?

The answer may surprise you.

Kobalt told MBW today (March 7) that they hope to create somewhere close to U.S. dollar 625 million dollars in total collection for the current fiscal year, through the end of June 2022. (Total collection is total revenue, plus fees received by Kobalt for advisory/asset management roles for purchased funds. music.)

Kobalt also predicts that it will end the current financial year with about a tenth of that figure, $65 millionin EBITDA profits.

These forecasts from Kobalt come as detailed company financial results for the Prior to FY – year to end June 2021 – published.

These are a particularly interesting set of financials for Kobalt, as they show the company’s financial performance for fiscal year 2021. do not have AWAL and Kobalt Neighboring Rights.

Kobalt today is divided into two defining operational divisions:

  • (I) Kobalt Music Publishing, which manages music publishing rights on behalf of clients, as well as provides asset management services to music catalog buyers (formerly Kobalt Capital); and
  • (ii) AMRAa global music royalty collection organization for musicians and publishers.

Based on these two operating divisions alone, Kobalt Music Group’s total revenue (excluding asset management fees) in fiscal year 2021 stands at 519.4 million dollars.

That number is up 11% on a similar basis compared to $ 465.9 million it was posted last year.

Kobalt’s publishing division increased its revenue for fiscal year 2021 by 9.6% to 478.4 million USDup from $436.1 million in the previous year.

And AMRA’s annual sales hit $100 million for the first time in fiscal year 2021, reaching $109.8 million. That’s because 40.2% Compared with the last year ($78.3 million).

Overall, in terms of total income (including that asset management fee), Kobalt said it generated 548 million dollars in FY2021, increase 15% YoY.

What does all of that mean in terms of profits?

Perhaps the most important metric on the subject: Kobalt Music Corporation’s profits from continuing operations (i.e. wiping out any contributions from AWAL and Kobalt Neighborhood Rights) stand at a premium. $5.9 million in 2021.

It’s an improvement of – wait for it – 71.8 million dollars compared to results from the same operating divisions in FY2020, as they recorded $65.9 million the loss.

According to Kobalt, their company posted a $48.5 million EBITDA ($44.0 million adjusted EBITDA) for fiscal year 2021 – the first time in the company’s history that it recorded an annual profit.

Notable: Kobalt’s latest financial figures reveal that AWAL and Kobalt Neighborhood Rights combined posted a 15.17 million dollars pre-tax loss (on revenue of approximately $150 million) for Kobalt in fiscal year 2021.

Largely due to the sale of those two companies to Sony in a $430 million deal last May, Kobalt closed in June 2021 with $314.98 million cash in the bank.

Laurent Hubert, CEO of Kobalt said: “The past few years have been transformative for Kobalt.

“Our financial success starts with our team, who support some of the best musicians in the world. Year after year, Kobalt’s hard work and focus continues to gain industry recognition.

“Across categories, Kobalt has received awards such as AS SOON AS POSSIBLELatin Independent Publisher of the Year, BMIGospel Publisher of the Year and BMI’s Hip-Hop/R&B Publishing House, all very high-profile titles. ”

“The past few years have seen a lot of changes for Kobalt.”

Laurent Hubert, Kobalt

Kobalt’s now-closed Kobalt Capital division was an investment advisor to two franchised funds (which brought in third-party investor funds), both of which were sold for large sums in the past two years: The Fund the first of these, launched in 2011, has been sold to Hipgnosis Song Foundation for $343 million at the end of 2020; the second fund, launched in 2017, is sold to KKR / Hendel . family for $1.1 billion last October.

In a note to shareholders regarding fiscal 2021 results, Kobalt founder and President, Willard Ahdritz, commented: “As a technology leader and music industry changer, We do not disappoint our expectations. In Act 1, we transformed the publishing industry with our global collection platform by introducing transparency, fairness, and technology with Kobalt.

“In Act 2, we transformed the recording industry using AWAL with Music as a Service (MaaS) for emerging artists. The past few years amid a challenging global pandemic but through it all, Kobalt has persevered and is stronger than ever.

“With the strong development of multi-territorial music services such as Spotify and Apple As well as the new health and fitness segments, I believe AMRA is essential in the industry and this will be our biggest innovation to date. ”

Willard Ahdritz, Kobalt

“We moved from our AWAL and Neighborhood businesses – which were very successful selling them to Sony – and exited Kobalt Music Capital with the sale of Fund I to Hipgnosis and Fund II to KKR and the Hendel family. Now a profitable and well-capitalized company, we can fully focus on doubling our award-winning digital social and publishing businesses.

“These milestones paved the way for our third action: eliminating frictions and breakdowns in the final leg of paying musicians and rights holders with AMRA, the society our global digital. With the strong growth of multi-territorial music services like Spotify and Apple as well as new segments in health and fitness, I believe AMRA is very much needed in the industry and this will be the big innovation. our best to date. ”

Writers signed to Kobalt Music Publishers hit their stride last year with co-writing hits from The Weeknd “Blinding Lights” and “Save Your Tears” (both co-written by Max Martin) composed), Doja Cat “Kiss Me More”, Karol G “Bichota”, Justin Bieber “Lonely” (Co-written by Finneas) and “Peaches” (Co-written by Andrew Watt), Kali Uchis “Telepatia” and many more songs other.

Kobalt Music Publishing’s client list includes Andrew Watt, Finneas O’Connell, Ozuna, Karol G, Lorde, Phoebe Bridgers, Stevie Nicks, The Foo Fighters, Roddy Ricch, Gunna, Kali Uchis and many more.

According to Kobalt, AMRA processed a record 29 billion in music royalties (up 40% year-on-year) in FY2021, distributing nearly $200 million in digital royals directly to musicians. and copyright holder.

Kobalt added in a note to shareholders: “AMRA’s business model has also not been impacted by the pandemic in the same way as the rest of the industry, as revenue is heavily skewed towards digital collections. Today, AMRA’s global rollout reaches all corners of the world outside of the US and includes direct digital collections for China, Brazil, and Japan and is constantly growing. ”

In 13 global offices, Kobalt serves more than 700,000 songs, 30,000 musicians and 500 publishers.Worldwide music business Even without AWAL, Kobalt Music Group is still a $600 million+ annual business…and comfortably profitable.

Fry Electronics Team

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