February 7, 2008

Warner Music Group falls to 1Q loss

NEW YORK - Warner Music Group Corp., whose artists include Led Zeppelin and Josh Groban, posted a first-quarter loss Wednesday, hurt by higher expenses and an impairment charge.

The recording company reported a loss of $16 million, or 11 cents per share, compared with a profit of $18 million, or 12 cents per share, in the previous year.

The results included an $18 million goodwill impairment charge, which reflects the reduced current value of an asset, as well as increased selling, general and administrative expenses.

Analysts polled by Thomson Financial expected net income of 10 cents per share. Those estimates typically exclude one-time items.

Revenue grew 7 percent to $989 million from $928 million a year earlier.

Analysts expected sales of $948.9 million, according to Thomson.

Recorded music sales climbed to $950 million from $800 million, while music publishing revenue increased to $144 million from $133 million. Digital sales surged 41 percent to $141 million.

The company said its revenue results continue to be pressured by the ongoing shift to new forms of digital music.

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