Reservoir Media, Inc. (RSVR, RSVRW Q4 FY2024 earnings call

• Record-setting total revenue and operating income for fiscal 2024, with an 18% year-over-year revenue increase. - Music publishing and recorded music segments grew 15% and 22% respectively for the full year. - Added award-winning artists/songwriters, including Joe Walsh, Kings Of Leon, and others; secured catalog acquisitions in various markets. - Super Bowl halftime show featuring Reservoir-owned assets reached an estimated 123.7 million viewers. - Utilized AI to increase revenue, automate tasks, and improve efficiencies, such as synch team using AI for metadata and marketing teams using AI for collateral. - Artists and creators contributed to ten Grammy awards, two Rock and Roll Hall of Fame inductions, and 42 number ones on Billboard charts.

For the full fiscal year 2024, music publishing segment revenue rose 15% year-over-year, and recorded music segment revenue increased 22% year-over-year. In the fourth quarter, music publishing generated $26.4 million in revenue, a 14% increase including acquisitions, with performance revenue up $3.2 million (73%) and digital revenue up $1.3 million (11%) to $13 million. Recorded music segment generated $11.2 million in revenue in the fourth quarter, a 3% increase compared to the prior-year quarter, with digital revenue up 9% and synchronization revenue up 147% due to strong 2024 Super Bowl synch activity.

• Fiscal 2025 revenue expected in the range of $148 million to $152 million. - Adjusted EBITDA expected in the range of $58 million to $61 million. - Confident in driving organic growth through value-enhancement efforts and capitalizing on industry growth, with a robust pipeline of potential acquisitions.

• Forward-looking statements involve risks and uncertainties that could cause actual results to differ from expectations. - Impact of Spotify's recent accounting change on compensation and revenue. - Potential one-off events like the release of De La Soul's catalog in fiscal 2024 affecting future performance.

Q: How do you think about the payoff for AI and machine-learning investments?

A: It's a little bit of both, creating efficiencies and freeing up human resources, as well as helping with better licensing and revenue generation.

Q: Do interest rates put a damper on M&A pace?

A: Still seeing adequate ROI in the pipeline, not viewing it as a material intermediate-term headwind