Essay on Emi Group Plc Case Study

4287 Words Sep 11th, 2011 18 Pages
1.0 INTRODUCTION

EMI Group plc

In early spring 2007, Martin Stewart as chief financial officer (CFO) for global music giant EMI, he’s knew most of the news that would break at the company’s April 18 earnings announcement. Annual underlying revenue for the company was down 16% to GBP 1.8 billion (British pounds). Earnings per share (EPS) have also dropped from 10.9 pence (p) in 2006 to -36.3p in FY2007. The performance reflected the global decline in music industry revenues, as well as the extraordinary cost of the restructuring program EMI was pursuing to realign its investment priorities and focus its resources to achieve the best returns in the future.

On an annual basis, EMI has consistently paid an 8p-per-share dividend to
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These “Comes with Music” phones will allow customers to download all the music they want to their phones and PCs and keep it—even if they change handsets when their year's subscription ends. Instead of charging consumers directly, Universal will take a cut of the price of each phone. The other majors are expected to strike similar deals.

Paid-for download services will continue and ad-supported music will become more widespread, but subsidised services where people do not pay directly for music will become by far the most popular, he says. For the recorded-music industry this is a leap into the unknown. Universal and its fellow majors may never earn anything like as much from partnership with device-makers as they did from physical formats. Some among their number, indeed, may not survive.

3.0 EMI GROUP PLC PRELIMINARY RESULTS FOR THE FINANCIAL YEAR ENDED 31 MARCH 2007

i. Underlying Group revenue fell by 15.8% on a reported basis and by 12.1% at constant currency ii. As announced on 18 April 2007 iii. EMI Music revenue fell by 15.0% at constant currency iv. EMI Music Publishing outperformed the recorded music market with revenue declining by only 0.9% at constant currency
v. Group digital revenue increased by 46.5% from £112.1m to £164.2m on a reported basis representing 9.4% of total underlying Group revenue vi. Continued success in finding and breaking long-term talent with top performing artists and songwriters in the financial

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