Reservoir Media (RSVR) 2027 財年第二季法說會：營收與財測指引上升

重點摘要

• Reservoir Media 公布 2027 財年第二季營收為 4,990 萬美元，包含收購在內年增 10%，有機成長則為 4%。
• 經調整後 EBITDA 成長 14% 至 2,210 萬美元，而折舊及攤銷前營業利益 (OIBDA) 成長 14% 至 2,070 萬美元。
• 淨利增加超過一倍，從 220 萬美元翻倍至約 460 萬美元。稀釋後每股盈餘 (EPS) 從 0.03 美元增至 0.07 美元。
• 音樂出版營收成長 8% 至 3,320 萬美元，受數位營收成長 10% 及同步授權營收成長 13% 所帶動。
• 錄音音樂營收成長 18% 至 1,540 萬美元，由數位營收成長 33% 與鄰接權營收增加所主導。
• 管理層調升並收窄 2027 財年財測，預估營收為 1.88 億至 1.92 億美元，經調整後 EBITDA 為 7,700 萬至 8,000 萬美元。

關鍵財務數據

截至 2026 年 9 月 30 日止的六個月，營業現金流為 2,160 萬美元，年減 370 萬美元，主要受營運資金時間差影響。Reservoir 在本季結束時擁有 1.139 億美元的可用流動資金，包含 2,480 萬美元現金及 8,920 萬美元的額外可用融資額度。

總債務為 4.586 億美元（已扣除 220 萬美元遞延融資成本）。淨債務達到 4.338 億美元，而 2026 年 3 月 31 日為 4.298 億美元。

業務與營運表現

音樂出版業務得益於額外的版權庫收購及串流服務持續成長。數位營收成長 10%，而同步授權營收因授權時間點關係成長 13%。

錄音音樂展現出較快的部門成長。在收購版權庫與串流成長的支撐下，數位營收成長 33%。新合作關係與收購亦強化了鄰接權營收。管理層表示，幾乎不具附帶費用的收購案有助於提升該部門的 OIBDA 利潤率。

Reservoir 透過與 Fred Ball 及 Jake Sinclair 簽約，擴充了活躍的出版陣容。該公司還與 Sinclair 成立合資企業，發掘並培植新銳詞曲創作者與藝人。管理層形容這些面向未來的合作安排前期資本需求有限，並按需要提供資金。

該公司收購了 Billy Strayhorn 的音樂出版版權庫，並參與其姓名、肖像與形象權（NIL）。同時也收購了 José Feliciano 版權庫的母帶錄音權，以及共享姓名、肖像與形象權。管理層將這些權利視為進一步延伸知名版權庫文化與財務價值的另一途徑。

管理層財務預測

Reservoir 調升並收窄其 2027 財年展望：

管理層將此展望歸因於收購版權庫的成長、活躍陣容的貢獻以及持續的成本控制。公司表示，在正常季度波動下，第二財季的行政管理費用運行率是下半年的合理參考基準。

管理層亦指出，該財測包含適度保守考量，並將隨著財年推進進行檢視。

風險與關注領域

• 由於 Reservoir 增加債務以資助版權庫收購與簽署創作者，導致利息費用增加。
• 上半年營業現金流下滑，主因版稅支付、應付帳款與預付版稅回收的時間點差異所致。
• 管理層表示收購時間點並非線性，每季在出版、錄音音樂與新興市場資產之間的交易集中度可能有所不同。
• 儘管公開市場估值存在差距，Reservoir 未觀察到音樂資產收購倍數下降，這可能會限制收購的經濟效益。
• 該公司正因某些 AI 平台涉嫌未經授權使用受保護作品而對其提起訴訟。管理層表示支持技術進步，但將尋求保護創作者權益。
• 特別委員會持續審查先前揭露的無約束力且主動提出的收購提案。管理層表示，該過程未改變日常營運重點。

分析師問答亮點

管理層將錄音音樂利潤率改善主要歸因於收購附帶費用極低的權利，表明該季的獲利能力反映了近期收購資產的經濟效益，而非僅是時間差因素。

在行政管理成本方面，管理層解釋第一財季可能包含年底應計費用調整與獎金費用，這些費用不會全年重複發生。預計第二財季的費用水準在第三及第四財季將大致保持穩定。

Reservoir 在內部也使用 AI 工具來將過往需手動或耗時的流程自動化。管理層表示這項效率提升工作在過去六至九個月中有所加速。

併購管道在出版版權庫、母帶錄音與新興市場資產之間保持平衡。然而，管理層強調交易流與交割時程難以預測，而賣方期望與收購倍數並未顯著下降。

完整法說會逐字稿

完整財報電話會議逐字稿

管理層陳述

Operator

Greetings. Welcome to the Reservoir Q2 FY '27 Earnings Call. [Operator Instructions] Please note, the conference is being recorded. I will now turn the conference over to Jackie Marcus at Alpha IR. Thank you, Jackie. You may begin.

Jacqueline Marcus

Thank you, operator. Good morning, everyone, and thank you for participating in today's earnings conference call. Reservoir Media issued a press release with results for its second quarter of fiscal year 2027 ended September 30, 2026, earlier this morning. If you did not receive a copy of our earnings press release, you may access it from the Investor Relations section of our website at investors.reservoir-media.com.

With me on today's call are Golnar Khosrowshahi, Founder and Chief Executive Officer; and Jim Heindlmeyer, Chief Financial Officer. As a reminder, this call is being simultaneously webcast and will be recorded and archived on the Investor Relations section of our website. Before I turn the call over to Golnar and Jim, I'd like to note that today's discussion will contain forward-looking statements that reflect the current views of Reservoir Media about our business, financial performance and future events and as such, involve certain risks and uncertainties.

Our expectations, beliefs and projections are expressed in good faith, and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs and projections will result or be achieved. Please refer to our earnings press release and our filings with the Securities and Exchange Commission for more information on the specific risks uncertainties and other factors that could cause our actual results to differ materially from our expectations, beliefs and projections described in today's discussion.

Any forward-looking statements that we make on this call or in our earnings press release are as of today, and we undertake no obligation to update these statements as a result of new information or future events, except to the extent required by applicable law. In addition to financial results presented in accordance with generally accepted accounting principles, we plan to present during this call certain financial measures that do not conform to U.S. GAAP. If we believe they are useful to investors or if we believe they will help investors to better understand our performance or business trends. Reconciliations of these non-GAAP financial measures to the nearest comparable GAAP measures are included in our earnings press release.

I would now like to turn the call over to Golnar.

Golnar Khosrowshahi

Thank you, Jackie. Good morning, everyone, and thank you for joining us today. Over the last 2 decades, Reservoir has built a reputation as a trusted partner for our talent, partners and shareholders alike. During the second quarter, we continued to deliver against that reputation, advancing our strategy across both publishing and recorded music, adding proven creative talent, expanding existing partnerships and pursuing opportunities in attractive markets.

Our recent investments reflect our ability to identify value across different stages of the music life cycle from supporting active talent whose efforts will yield new untapped copyrights over the coming years to stewarding established catalogs with enduring cultural and commercial significance.

Today's earnings results continue to reinforce the strength of those fundamental strategic pillars with another successful quarter. In the second fiscal quarter, we extended our run of top line growth with revenue up 10% year-over-year and organic growth of 4%. Looking first at our publishing business, we continue to strengthen our roster with established songwriters and producers whose track records position them for continued success.

In September, we announced a futures publishing deal with London-based songwriter and producer, Fred Ball. Fred co-wrote and co-produced Rihanna's Diamond-certified Love on the brain and his work spans records with Deane, JZ, M&M, Alicia Keys, Mariah Carey and Olivia Dean, among many others. He remains a sought-after collaborator among leading artists, and we are excited to be part of the next chapter of his career. We also signed Grammy-nominated songwriter and producer, Jake Sinclair, to a publishing deal for his future works. Jake has written and produced hits for Falloutboy, Weezer, 5 Seconds of Summer and Panic at the Disco, including their diamond-certified track, High hopes.

Alongside the publishing deal, we formed a joint venture with Jake to identify and develop emerging songwriters and artists, combining Jake's creative instincts with Reservoir's global platform and publishing expertise. We believe this approach can generate attractive opportunities to build incremental value for both Reservoir and Jake by further aligning our interests.

We also expanded our frontline roster across key genres and markets. In the U.K, we welcomed Scottish Indie Rock Band The Snuts and Ivor Novello winning Singer Songwriter -- or [ La Gardlet. ] Across country and Fok Music, we announced deals with songwriter Justin Dukes, Singer Songwriters Eva Liv Mabry and Riley Veterer and Singer Songwriter Duo the Recloss.

Together, these signings demonstrate our continued commitment to developing a globally diverse roster of talent. By investing in creators across genres, geography and career stages, we strengthened the range of opportunities available across our publishing business. Beyond our active roster, we continue to build on long-standing relationships with established catalogs and their representatives. During the quarter, we announced the acquisition of Billy Straayhorn's publishing catalog in addition to participating in rights to his name, image and likeness.

Widely regarded as one of the great composers in Jazz's history, Straayhorn was Duke Ellington's long-time creative partner and wrote enduring standards, including, Take the A Train and Luslife. Reservoir has published his catalog for more than a decade, working closely with his estate to champion his music, and we are honored to continue to steward his legacy in the years to come.

In recorded music, we expanded our portfolio through a deal with legendary Puerto Rican singer songwriter, Jose Feliciano, to acquire master recording rights to his catalog as well as shared rights to his name, image and likeness. Over a career spanning 6 decades, Jose has released more than 60 albums crossing over into Anglo American Pop and earning multiple Grammy awards, a star on the Hollywood Walk of Fame and the National Medal of Arts, among numerous other honors. He is also the writer and original recording artist behind Feliz Navidad, one of the world's most enduring and widely played holiday songs to this day. But the recording, which returns to the charts each holiday season and recently reached #6 on the Hot 100 was inducted into the Grammy Hall of Fame in 2010 and just this year was selected by the Library of Congress for preservation in the National Recording Registry.

This deal builds upon our existing investments in Latin music, which remains one of the fastest-growing areas of global music demand. Jose's remarkable catalog combines blasting cultural relevance with continued audience engagement, reflecting our strategy of partnering with influential artists and investing in music with the potential to resonate across generations and markets.

Notably, through the deals with Billy Strehorn and Jose Feliciano, Reservoir is taking part in the NIL value chain, a facet of transactions we have leveraged throughout the last 12 months during the Miles Davids Centennial. Introducing Miles and his music to new fans through key brand partnerships has been an important way of continuing to bring value to his portfolio, both culturally and financially.

Structuring deals with NIL components is a thoughtful way we continue to seek opportunities to enhance the value of Reservoir's assets and share them to a wider audience. In looking at the broader music landscape, several trends are particularly relevant to our business. Subscription pricing continues to present opportunities for growth as streaming services implement price increases and consumers consistently demonstrate the value they place on access to music.

Additionally, sentiment around catalog transactions remains positive, reinforcing our view that well-managed catalogs are durable long-life assets. And third, for many established artists, touring and brand partnerships now drive more of their economics than a traditional record contract. Together, these trends reinforce our conviction in the long-term value of music copyrights and the opportunities available to companies with the expertise to manage, market and monetize them effectively.

We remain focused on positioning Reservoir to participate in this growth while maintaining the financial discipline that has guided our investment decisions. One other trend worth noting is the potential industry growth from new AI licensing revenue as noted in Goldman Sachs Annual Music and MA report. You may have recently seen Reservoir's litigation against certain AI platforms. Reservoir's business is rooted in our responsibility to protect the rights and creative legacies of our songwriters, artists, estates and partners.

And when we believe their work has been exploited without authorization, we will hold AI platforms legally accountable to ensure those rights are upheld. We will continue to advocate for a framework that supports technological progress while protecting the creative work at the heart of our industry.

Jim will take you through the details of our financial performance shortly, but I wanted to emphasize that the consistency of our revenue and cash generation is what allows us to continue investing in our team, our infrastructure, our creators and new strategic opportunities without compromising financial discipline.

Before turning to our financial performance, I'd like to briefly address the previously disclosed nonbinding and unsolicited acquisition proposals received by the company. In March 2026, the Board formed a special committee of independent and disinterested directors to evaluate the proposals, and the special committee engaged Morgan Stanley & Company LLC as its financial adviser and Watetel, Lipton, Rosen & Katz as its legal counsel. While the special committee's review continues, our team remains focused on executing our long-term strategy and the process does not change our day-to-day priorities.

I will now turn the call over to Jim to discuss our fiscal second quarter financial performance. Jim?

Jim Heindlmeyer

Thank you, Golnar, and good morning, everyone. Our strong second fiscal quarter results reflect our impressive catalog of in-demand assets as we continue acquiring more catalogs, deepen existing relationships and identify opportunities.

Revenue for the second fiscal quarter was $49.9 million, a 4% year-over-year improvement on an organic basis and a 10% increase when including acquisitions. This was led by the 18% growth in our Recorded Music segment and the 8% increase we had in Music Publishing.

Turning to our operating expenses. The total cost of revenue increased 7% compared to the prior year quarter, while our administration expenses and amortization and depreciation costs grew 7% and 12%, respectively, versus the prior year. The increase in administration expenses was driven by higher expenses within Music Publishing and Recorded Music segments. Amortization costs grew due to the acquisition of additional music catalogs.

Looking at operating performance for the second quarter, OIBDA was $20.7 million, an increase of 14% year-over-year, and adjusted EBITDA was also up 14% to $22.1 million compared to our Q2 and fiscal 2026. The increases in OIBDA and adjusted EBITDA were due to higher revenues, partially offset by increases in cost of revenue and administration expenses, as I just mentioned.

Interest expense was $7 million for the quarter versus $6.7 million in the prior year, driven primarily by increased debt balances used to fund acquisitions of music catalogs and writer signings.

Net income for the second quarter was approximately $4.6 million compared to net income of $2.2 million in the second quarter of fiscal 2026. The increase in net income was primarily driven by the increase in operating income and the higher gain on fair value of swaps and gain on foreign exchange, partially offset by increases in interest expense and income tax expense.

This resulted in $0.07 diluted earnings per share for the quarter, up from a diluted earnings per share of $0.03 in the prior year quarter. Our weighted average diluted outstanding share count during the quarter was approximately 66.8 million.

Now let's dive into our segment review for the quarter. Music Publishing had an 8% increase in revenue versus the prior year quarter at $33.2 million, largely due to a 10% increase in digital revenue, which was driven by the acquisition of additional music catalogs and continued growth at music streaming services. Additionally, synchronization revenue expanded by 13% within Music Publishing, driven by the timing of licenses.

Moving to our Recorded Music segment. We had an 18% increase to $15.4 million in revenue compared to our Q2 last year. This was driven by a 33% increase in digital revenue, which was also supported by the acquisition of additional music catalogs and continued growth at music streaming service. Robust neighboring rights revenue driven by the acquisition of additional music catalogs and new affiliations also supported our strong growth in Recorded Music.

Turning to our balance sheet. For the 6 months ended September 30, 2026, cash provided by operating activities was $21.6 million, which was a decrease of $3.7 million compared to the same period last year, primarily due to a change in cash used for working capital resulting from the timing of royalty payments to creators and payments of accounts payable, partially offset by the timing of royalty advance recoupments.

We had total available liquidity of $113.9 million, consisting of $24.8 million of cash on hand and $89.2 million available under our [indiscernible]. We ended the quarter with total debt of $458.6 million, which was net of $2.2 million of deferred financing costs, and thus, we maintained $433.8 million of net debt. That compares to net debt of $429.8 million as of March 31, 2026.

Given our strong first half performance, we are narrowing and raising our full year guidance ranges. We now expect revenue of $188 million to $192 million, which at the midpoint implies growth of 8% versus fiscal 2026. We are also raising our adjusted EBITDA guidance range to $77 million to $80 million, which signals growth of 7% over the prior year at the midpoint of that range. We will continue to review our outlook as the year progresses and look forward to providing an update when appropriate.

After the first half of fiscal 2027, the drivers behind our performance are consistent with our strategy, acquiring catalogs that continue to grow under our stewardship and active roster contributing to today's hits and continued cost discipline. Between our consistent cash flows and our measured approach to capital deployment, we remain confident that we'll be able to deliver on our raised fiscal 2027 guidance.

With that, I'll now pass the call back to Golnar.

Golnar Khosrowshahi

Thank you, Jim. We are pleased with the first half of fiscal 2027 and with the opportunities we've identified ahead of us as Reservoir heads into its 20th anniversary in calendar year 2027. This quarter's activity from futures partnerships with Fred Ball and Jake Sinclair to investments in talent like Orla Gartland and Riley Beeterer and to our agreements with Jose Feliciano and the Billy Shrehorn Estate shows the range of Reservoir investments across genres, eras, geography and deal structures. Our pipeline remains robust, and we look forward to sharing more proof points of our strategy.

With that, we will now open the line for questions.

Operator

[Operator Instructions] Our first question is from Griffin Boss with B. Riley Securities.

分析師問答

Griffin Boss

I just wanted to start off on OIBDA. So on the recorded side, specifically, there was a meaningful step-up in the margin year-over-year. Just curious, Jim, is that more a function of timing? Or are you seeing structurally higher margins on new acquisitions and affiliations?

Jim Heindlmeyer

Yes. Sometimes with our new acquisitions, when we are acquiring rights that have very low, if any, expenses, it's going to improve that margin. And I think that's really what we're seeing in the quarter relative to last year, given some of the acquisitions that we've done in the past year.

Griffin Boss

Understood. And then just sticking on profitability. So it's good to see the raise and narrow guide, but that does imply a slightly slower growth in EBITDA than what you're expecting on the top line. So I just want to dig into kind of how much of that could be maybe conservatism versus expectation for higher administrative or other expenses in the back half of the year?

Jim Heindlmeyer

Yes. I think that with respect to the administration expenses, it's really like our Q2 run rate is probably a good proxy for the rest of the year. I think that there's an appropriate level of conservatism built into our guidance, and it's probably what's impacting what you're seeing there.

Griffin Boss

Okay. Got it. And then if I could just sneak one more in here, maybe for Golnar. There are other large public labels, of course, publicly traded labels, one of which supposedly held talks earlier this year, entertaining the idea of going private, just given kind of what seems to be steep discounts in the public market.

So I'm curious if you're seeing in your M&A activities, any step down in multiples versus what you've seen historically given what we're seeing in the public markets for music assets?

Golnar Khosrowshahi

I guess if we keep saying that, maybe we'll see it. But unfortunately, we haven't really seen any loss in -- or any decrease in these purchase multiples. We continue to execute at attractive multiples and that information or updated information will be included when we disclose the next investor presentation. But on balance, as far as the deals that we see trading and those that we're participating in, we are not seeing any decrease in expectations whether as a result of or separate from this disparity in value between the sort of asset value and where these stocks are trading.

Operator

Our next question is from Richard Baldry with ROTH Capital Partners.

Richard Baldry

You talked about the administrative expenses being a good run rate from here. The level in the quarter was down from both first quarter and even the fourth quarter of last year. Can you talk a little bit about sort of where you've gained some efficiencies there, why that's sustainable? And does that just naturally sort of step up year-over-year when we move out to fiscal '28?

Jim Heindlmeyer

Yes. I think on the overhead side, the administration expenses, our Q1 is sometimes impacted by some of the activity in our Q1, which is to be true-ups of year-end accruals. There's some bonus activity in Q1 that hits that's not recurring throughout the the rest of the year. So there's a few things there that are impacting that. And I think that as you look at the Q2 run rate, it really should be pretty steady from there for Q3 and Q4, some minor variances with some of the things that just fluctuate throughout the year, but it's a pretty good run rate.

Richard Baldry

And I think of it as more of a hands-on sort of company dealing with your clients. But beyond that, is there any back office ability to sort of leverage newer AI technologies to automate maybe some of the accounting end of the table that might be more manual today than it could be down the road as an efficiency gain?

Jim Heindlmeyer

Yes. Our teams are certainly very active with AI tools to find areas where things that have historically been a pretty manual process or time-consuming process where we can leverage those AI tools to find efficiencies. And that's been happening quite a bit over the past kind of 6 to 9 months, as you can imagine.

Richard Baldry

And turn to the new JV, for example, can you talk about sort of how a development like that works? How much resources you typically would put in? What payback periods you're thinking about? I assume these are fairly long tail events.

Golnar Khosrowshahi

Rich, I'm sorry, which JV are you referring to?

Richard Baldry

You were noting one with a younger artist.

Golnar Khosrowshahi

I mean every deal is different. These JVs are structured such that we are able to capitalize on the talent and the access that, that talent brings. We are never fully tied in that we can always make a decision to sort of alter course on that front. We're not talking about significant dollar amounts, and we are talking about investment that is made on an as-you-go basis. Again, these are mostly futures deals. So the investment number, the absolute value is not a significant number.

Richard Baldry

Okay. And last for me. It looks like an unusually good cash generation quarter and sort of your net debt number came in pretty good. I don't have the queue yet to sort of go through that. Can you talk about if there's any unusual sort of onetime events in there or just traditional seasonality that's driving that so I can better understand.

Jim Heindlmeyer

Yes, sure. Typically, our Q2 and Q4 are pretty strong cash-generative quarters for us. So I think that you're certainly seeing some of that. That's probably the most significant thing. It was a fairly light quarter for us on the M&A front, which happens quarter-to-quarter. We can't control the timing of deal flow, and that's not something that's linear throughout the year. But I think it's just those 2 things that are coming together.

Richard Baldry

Maybe one last one. If you look in your M&A pipeline, is the balance of opportunities changing at all, whether it's by geography, recorded publishing or still just opportunistic as the best thing sort of plug into each sector?

Golnar Khosrowshahi

I think I would look at it 2 ways. One is what's coming in and what's coming in varies quarter-by-quarter. Obviously, we can't predict deal flow, but I think it's a pretty well-balanced grouping of publishing targets and recorded targets as well as emerging markets assets. As far as what is making it across the sort of exclusivity line and into our short-term deal flow, I believe that, that is also mirroring the general deal flow, which is, again, a good balance across the board.

We may end up having some concentration in any given quarter on publishing acquisitions or Masters acquisitions, but that is not really an indication because it's just such a small time frame to be looking at. We are always looking to do the best deals we possibly can.

So at certain points, that might concentrate on recorded publishing, emerging markets, what have you. But we're seeing a very good balance of deals in front of us.

Operator

We have reached the end of the question-and-answer session. I would like to turn the floor back over to Golnar Khosrowshahi for closing comments.

Golnar Khosrowshahi

Thank you, everyone. We appreciate your support and interest in Reservoir. Thank you.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.