EMI records £163m loss
Mark Tran
Monday May 24, 2004
EMI, the world’s third-largest music company, today reported a pre-tax loss of £163.3m, but predicted a return to growth thanks to positive trends in the US.
The EMI chairman, Eric Nicoli, predicted that sales in the global recorded music market would be between flat and down by 4% in the year ending March 31 2005.
However, he saw signs of possible growth for the beleaguered industry in the following year, and said EMI was largely basing its optimism on a pickup in the US, which had shown positive sales figures over the last nine months.
“From about the middle of last calendar year, the US market has been in positive territory, which is encouraging,” Mr Nicoli said. “That is the basis for our optimism for the global market, as the US is a third of the total market.”
In common with other music companies, EMI – whose artists include Norah Jones, Coldplay and Robbie Williams – has been hit by internet piracy and the lack of new artists, putting a big dent in sales.
For the year to March 31, EMI’s recorded music division saw sales fall by 2%, to £1.7bn, while the industry saw a decline of 5.6%.
In March, EMI said it would trim its artist roster by one fifth, and outsource CD and DVD manufacturing in the US and Europe. The company maintained its full-year dividend at the previous year’s level of 8p per share.
In the US – the world’s largest music market – EMI reported a 4% rise in its recorded music sales over the six months ending March 31 2004.
Mr Nicoli said this partly reflected legal action taken against internet piracy by the recording industry.
“Our efforts to contain piracy are having a positive impact, and we are experiencing exciting growth in legitimate digital music,” he said. “For the first time in several years, there are encouraging signs of market improvement.”
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