Fri, Mar 16, 2018 - Page 11 News List

Music label posts record net income of NT$321m

By Chen Cheng-hui  /  Staff reporter

Record label HIM International Music Inc (華研音樂) on Monday reported net income of NT$321 million (US$10.99 million) for last year, up 14 percent from the previous year and marking the highest in the company’s history, as contributions from cost control and rental income helped offset the negative effect of declining revenue.

To maintain a high payout ratio policy, HIM said its board had proposed to distribute a cash dividend of NT$5 per common share and a stock dividend of 15 percent, based on earnings per share (EPS) of NT$6.81 for last year.

The Taipei-based company said it made progress on two fronts last year: Organizing as many as 42 concerts by artists, such as Tian Fu-chen (田馥甄), commonly known as Hebe, and duo Power Station (動力火車), and releasing 22 albums, while making a foray into the sports agency business by signing tennis player Latisha Chan (詹詠然) and her younger sister, Chan Hao-ching (詹皓晴) as well as table tennis player Chiang Hung-chieh (江宏傑).

However, HIM saw overall revenue fall 5 percent year-on-year to NT$1.55 billion, affected by fewer invitations from Chinese reality TV shows and fewer product endorsement contracts compared with a year earlier, analysts said.

In recent years, the company has seen growth in revenue generated from its licensing partnerships with US-based music streaming service provider Apple Music, Taiwanese streaming platform KKBOX Inc and Alibaba Group Holding Ltd’s (阿里巴巴) music app Xiami (蝦米), in addition to licensing deals with KTV parlors.

After the expiration of its licensing agreement with Xiami, HIM on March 1 announced that it had entered into a strategic cooperation with NetEase Cloud Music (網易雲音樂), a Chinese streaming platform whose user base has rapidly grown the past four years to exceed 400 million.

“The cooperation with China’s fourth-largest digital music platform [NetEase Cloud Music] is expected to significantly increase HIM’s licensing income,” Jih Sun Securities Investment Consulting Co (日盛投顧) analyst James Hou (侯相印) said in a note on Tuesday.

With a higher contribution from the licensing business, which carries a higher gross margin, HIM’s net income for this year is estimated to expand 30.5 percent to NT$360 million, with EPS of NT$7.73, he said.

HIM shares closed at NT$131.5, up 0.38 percent, in trading on the Taipei Exchange yesterday.

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