Benzinga | Aug 3, 2021 09:13AM EDT

Warner Music Beats On Q2 Revenue Aided By Robust Digital Revenue, Expands OIBDA Margin

* Warner Music Group Corp (NASDAQ:WMG) reported third-quarter FY21 revenue growth of 33% year-on-year to $1.34 billion, beating the analyst consensus of $1.2 billion.

* Recorded Music revenue grew 34% Y/Y to $1.15 billion, reflecting the continuing growth in streaming. Music Publishing increased 27% Y/Y to $189 million, driven by digital, synchronization, and mechanical revenue growth, and Digital grew 29% Y/Y to $928 million.

* Adjusted OIBDA margin increased 320 bps to 19.6% due to strong operating performance and margin improvement associated with revenue mix. Adjusted EBITDA margin improved 230 bps to 21.0%.

* EPS of $0.12 missed the analyst consensus of $0.15.

* Warner Music generated $91 million in operating cash flow and held $442 million in cash and equivalents. Free cash flow fell to $(71) million, down from $87 million a year ago.

* The Q3 reflected impressive streaming numbers, recovery in several areas that COVID had negatively impacted, and powerful operating leverage that drove margin expansion, CFO Eric Levin stated.

* Price action: WMG shares closed lower by 2.1% at $37 on Monday.

* Photo by StockSnap from Pixabay