Hipgnosis profit surges as song catalogue hits the right notes
Music royalties investment firm Hipgnosis has posted a huge rise in pre-tax profit after snapping up some of the biggest hits of the decade in an aggressive acquisition spree.
The London-listed firm today reported pre-tax profit of £12.6m in the six months to the end of September, more than four times the £3m posted in the same period last year.
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Total revenue increased more than threefold to £22.6m, while net asset value rose five per cent to 108.5p.
The sharp growth comes amid a rapid expansion plan for Hipgnosis, which has secured the rights to a string of heavy-hitting songwriters and artists.
The firm today said it has acquired the catalogue of Jeff Bhasker, the producer and writer behind Uptown Funk by Mark Ronson and Bruno Mars.
The latest acquisition means Hipgnosis now holds the rights to five of the top 10 songs of the decade, as ranked recently by Billboard Magazine, including Shape of You by crooner Ed Sheeran and Justin Bieber’s chart-topper Despacito.
To date, Hipgnosis has pumped more than £500m into acquiring a music catalogue comprising more than 11,000 songs. The firm today said it is in “advanced stage discussions” on an investment pipeline of more than £1bn.
“Our excellent first half is a testament to the quality of the songs that we have acquired to date and are proud to see so many of our catalogues performing so well,” said Hipgnosis founder Merck Mercuriadis.
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“With investors needing uncorrelated assets more than ever, and proven Songs producing reliable and predictable income, the new asset class of proven songs is, in our view, now more investible than gold and oil.”
Hipgnosis has also bolstered its board after transferring to the premium segment of the London Stock Exchange in September, appointing ex-Sony executives Paul Burger and Sylvia Coleman as senior independent director and non-executive director respectively.