Reservoir Media(US:RSVR)2025-05-28 15:00Financial Data and Key Metrics Changes - Reservoir Media reported a 10% year-over-year increase in revenue for fiscal year 2025, reaching $158.7 million, exceeding guidance [18] - Adjusted EBITDA for the fiscal year increased by 18% to $65.7 million, driven by higher gross margins and improved operating leverage [19] - Net income for fiscal year 2025 was $7.7 million, compared to $0.8 million in the previous year, resulting in diluted earnings per share of $0.12 [20] Business Line Data and Key Metrics Changes - The Music Publishing segment generated revenue of $27.9 million in Q4 2025, a 6% increase year-over-year, with synchronization revenue up 51% [21] - The Recorded Music segment saw revenue of $12 million in Q4 2025, a 7% increase, with digital revenue rising 19% [22] - For the full year, Music Publishing revenue rose 12%, while Recorded Music revenues increased by 4% [23][24] Market Data and Key Metrics Changes - The company is focusing on emerging markets, particularly India and the Middle East, where significant growth opportunities exist due to rising internet connectivity and listenership [11][12] - India is projected to grow at a 13% CAGR through 2027, presenting a substantial opportunity for expanding the company's international roster [13] Company Strategy and Development Direction - The company aims to build scale through portfolio-accretive mergers and acquisitions and long-term value-additive signings [27] - Reservoir Media is committed to organic growth and has the necessary rights and infrastructure to market its portfolio aggressively [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the music industry's resilience against macroeconomic headwinds, highlighting strong demand for their catalog [27] - The company anticipates continued strong results in fiscal year 2026, with revenue guidance set between $164 million and $169 million [26] Other Important Information - The company closed the fiscal year with total liquidity of $79.6 million and total debt of $388.1 million [25] - Reservoir Media's strategic capital deployment included over $15 million towards acquisitions and advances [6] Q&A Session Summary Question: Are you seeing markedly better ROIs in international geographies? - Management noted better opportunities and higher ROIs in emerging markets like India and the Middle East due to less competition [30] Question: How do you look at revenue seasonality in 2026? - Management expects a return to a more regular cadence, with the second and fourth quarters likely being slightly higher than the first and third [31] Question: Can you talk about your hedging strategy regarding interest rates? - The company is currently hedged at $150 million and is evaluating the need for additional hedges due to recent volatility [32] Question: How much capital are you targeting to deploy in 2026? - Management indicated that capital deployment will be opportunistic, depending on available deal flow [33] Question: Can you clarify the $150 million figure mentioned for capital deployment? - The $150 million figure refers to the total for the year, not just the fourth quarter [40] Question: How does the growth rate in India compare to other regions? - The growth rate in India is significant due to its large population and potential for converting users to paying subscribers, unlike more saturated markets like the US [42] Question: What is the expected organic growth rate for the current catalog? - Management indicated that while they have had hits, they do not project another hit in fiscal year 2026, leading to a more conservative guidance [48]