Sanctuary credits Morrissey for sales rise

Entertainment group Sanctuary today attributed a 45.7% rise in revenues to a resurgence in the popularity of indie icon Morrissey.

Morrissey released his first album in eight years with nearly a million copies of You Are The Quarry shipped worldwide andhad four top ten singles in the UK during 2004.

With rock artists The Libertines and The Strokes also enjoying chart success, turnover from Sanctuary’s recorded music division rose to £127.3 million during the 12 months to September 30 – a significant leap on the £78 million of last year.

Overall turnover for the company totalled £220.9m (€319.5m) for the year, including contributions of £31.8m (€55.1m) from artist management and live acts and £50.1m (€72.5m) from merchandising.

Pre-tax profits of £16.1m (€23.3m) were lower than the £17m (€24.6m) reported a year earlier, reflecting write-offs totalling £2.1m (€3m) in the division that publishes music books.

News of these write-offs was outlined in a trading statement on Tuesday that also warned of an £11.4m (€16.5m) provision against loan notes issued in connection with the 2003 sale of its television business Cloud 9.

Shares slumped more than 14% in the wake of that update, but recovered some of the lost ground yesterday and improved a further 2% today.

Sanctuary is owner of the world’s biggest live tour booking agency outside the US and a strong touring year saw sell-out shows staged for artists such as Beyoncé, Iron Maiden, Franz Ferdinand and The Darkness worldwide.

In 2003, the group set up a division to bring in new R&B and hip-hop acts in partnership with the father of Beyoncé and expand its sphere beyond rock music.

Artists to join the venture during the past 12 months have included Nelly, whose albums have gone multi-platinum, and D12.

Executive chairman Andy Taylor said the group had exciting prospects for growth in the next few years, both through its traditional channels and also digital downloads. Sanctuary has deals with online jukeboxes including i-Tunes and Napster.

He said: “We are seeing signs that the major record companies are focusing on developing long term career artists again, which we believe will lead to a resurgence in enthusiasm for music and recorded product.”

Bottom-line losses of £1.8m (€2.6m) reflected the one-off charge against the sale of Cloud 9 and compared with profits of £10.8m (€15.6m) a year ago.

City-based brokers CSFB said: “Overall, we view the operating performance as solid and note that the development of cash flows in the recorded music division and the growth in artist management as particularly encouraging.”