Beggars Group revenues hit $83m in 2019, as XL Recordings generated over $50m

Beggars Group, home to indie labels such as XL Recordings, Matador, 4AD and Rough Trade, generated £63.1m ($83.4m) in total turnover last year.

That’s according to freshly-filed UK Companies House documents reviewed by MBW.

The £63.1m annual revenue figure was down by £11.1m on the £74.2m Beggars generated in the prior year – but Beggars said it actually grew on a like-for-like basis in key territories.

This difference was due to the one-time benefit of Beggars’ Spotify share sale (via Merlin) in 2018. (Beggars previously confirmed that it paid its artists 44% of these Spotify share proceeds in cash.)

XL Recordings, which files with Companies House separately, saw its revenues hit £39.0m ($51.5m) in 2019.

Beggars’ new fiscal filing says that, in 2020 so far, the COVID-19 pandemic has limited the company’s “promotional activity on new releases for the period of lockdown”. The firm predicts this will now continue “to an extent while social distancing measures remain in place”.

Beggars, which is owned by Chairman/Founder Martin Mills, added: “There will be a financial impact [from COVID-19] both in terms of reduced sales, but also short-term reduced costs from deferring those releases or limited promotional activity.”

“Whilst we are expecting a slowdown in certain channels [from the pandemic] – for example physical sales, synchronisation, and performance income – we expect streaming to be least affected.”

Beggars Group

However, Beggars said that it “has the benefit of a strong back catalogue generating a significant portion of its sales”.

It further noted on COVID-19’s impact: “Whilst we are expecting a slowdown in certain channels – for example physical sales, synchronisation, and performance income – we expect streaming to be least affected.”

Beggars Group did not pay out a dividend in 2019, having paid out £8m in 2018.

XL Recordings, which is co-owned 50/50 by its founder Richard Russell and Beggars Group Ltd, paid out £10m in dividends last year, but paid out zero in 2018.

Beggars Group, one of the biggest independent label operations in the world, owns 50% of XL, Matador and Rough Trade, and 100% of 4AD.

Excluding its share of these and other joint ventures, Beggars’ turnover in 2019 stood at £37.7m ($49.8m), down from £40.58m in 2018.

Beggars’ total annual operating profit weighed in at £3.7m ($4.9m) last year, down from £11.95m in 2018. (Again, this fall would have been significantly affected by the 2018 Spotify share sale.)

Beggars paid £850,493 ($1.1m) in tax for 2019.

Beggars Group, which runs offices in both London and New York, says that it released 40 albums in 2019, up on the 36 it released in the previous year.

At the close of 2019, Beggars Group had £24.9m ($32.9m) in cash, down on the £28.7m it had at the end of the prior 12 months.

According to Beggars’ latest filing, the company’s UK-based turnover (not including joint venture revenue) grew very slightly in 2019, up to £9.9m ($13.0m.)

Its global turnover from ‘sales and licensing of sound recordings’ (again, not including joint venture revenue) dropped from £34.1m in 2018 to £31.2m in 2019.

Beggars employed an average of 147 people in 2019, up from 140 in the prior year.

Looking closer at XL Recordings’ performance in 2019 shows that the label’s total revenues – including its share of joint ventures – fell year-on-year but, again, this was significantly affected by XL’s Spotify share sale in 2018.

XL managed to hit its £39.0m ($51.5m) turnover last year despite releasing only six albums across the 12 months.

Those albums included the Grammy-nominated Anima from Thom Yorke.

Another 2019 Grammy nomination at the company was secured for Best Music Video – Cellophane by FKA Twigs (pictured).

FKA Twigs, who released the acclaimed album Magdalene last year, is signed to Young Turks, in which XL Recordings owns a 50% stake.

Interesting to note: XL’s latest fiscal filing reveals that the label’s ownership stake in Young Turks actually reduced last year.

On January 1, 2019, XL agreed to reduce its stake from 75% to 50%.

As a result, XL ceased to own a controlling stake in Young Turks, which officially became a Joint Venture label.

All GBP to USD currency conversion here based on the Bank Of England’s exchange rate as of December 31, 2019.Music Business Worldwide

Related Posts