MONTREAL — Music service provider and broadcaster Stingray Group Inc. yesterday reported its revenues increased 23.9% to $64.8 million for the first quarter of its 2022 fiscal year, compared to the same quarter a year ago.
“This quarter was marked by a strong 24% increase in revenue correlated with a gradual return to normal commercial operations, particularly in Radio,” said Stingray president, co-founder and CEO Eric Boyko in a press release announcing the company’s financial results for the three months ended June 30, 2021.
“Overall organic growth for the quarter was close to 2% while the U.S. segment reached an impressive 11.6%. The diminishing favourable impact of the Canada Emergency Wage Subsidy (CEWS) and a return to more sustainable operating expenses this quarter when compared to the successful implementation of significant cost saving measures last year translated into a slight decrease in adjusted EBITDA to $24.2 million.”
Revenues in Canada increased $13.3 million or 47.5% to $41.4 million in the first quarter of fiscal 2022, from $28.1 million in Q1 2021.
U.S. revenues remained stable at $10.3 million in Q1 2022 as the negative impact of foreign exchange was offset by organic growth in advertising revenues in the Broadcast and Commercial Music segment, the company said.
Stingray’s revenues in other countries decreased by 5.6% to $13.1 million, from $13.9 million in Q1 2021, which the company attributed primarily to a decrease in subscription revenues.
Net income in Q1 2022 was $4.2 million, down 40.2% from $7 million in Q1 2021. Adjusted net income in Q1 2022 was $11.2 million, a 16.8% decrease from $13.5 million in Q1 2021.
“Broadcasting and Commercial Music revenues were relatively stable at $35.6 million compared to the previous year. Revenues reflect the negative impact of foreign exchange, offset by an increase in advertising, the gradual easing of Covid-19 restrictions and the return to normal commercial operations. In the U.S., FAST (free ad-supported TV) channels were an important contributor to growth with overall advertising increasing 120% over last year. Adjusted EBITDA decreased to $14.7 million from $20.3 million for Q1 2021. The decrease is due to lower CEWS and higher operating costs, both caused by an improving business environment,” Boyko said.
For radio, gradual easing of restrictions and “the return to normal commercial operations resulted in a 78.8% increase in revenues to $29.2 million, despite Ontario still being under relatively heavy restrictions during the quarter. Higher revenues fueled adjusted EBITDA growth of 87.9% to reach $10.8 million. Despite reduced benefits from CEWS and higher operating expenses, the adjusted EBITDA margin increased from 35.2% last year to 37.0% this year.”
Boyko said the recent acquisition of Calm Radio has increased Stingray’s total number of streaming subscribers to 572,000, which represents a 31.2% increase over the first quarter of 2021.
“This new acquisition adds 1,500 channels focused on relaxation and wellness to our comprehensive portfolio. It also grows the streaming subscriber base by more than 30,000 and will increase our overall average revenue per subscriber,” Boyko said.
For more in Stingray’s Q1 2022 financial results, please click here.
