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Music giant EMI swings to profit
LONDON, England (CNN) -- Britain's EMI Group, which axed jobs and dumped stars as part of its revamping to revive its ailing business, has swung to profit despite declining sales. The world's third largest music group said on Tuesday it had made an adjusted pre-tax profit of £42.2 million ($67.1 million) in the six months to September 30, compared with a £2 million loss in the same period a year earlier. EMI -- the home of Robbie Williams, Kylie Minogue, Cold Play and Radiohead -- also said its sales slid 10 percent to £961.5 million, with core recorded music turnover tumbling more than 12 percent as the illegal copying of music on the Internet grows. It was the first results the company has posted since its radical overhaul in March, which included slashing 1,800 jobs and axing 400 high-profile artists, like Maria Carey, from its roster to return to profitability.
The London-based company brought former Polygram boss Alain Levy in last year to turn around its recorded music business. Levy said that EMI, with cost savings of £32 million in the first half, was on track to reach a recorded music margin of nine percent this year, up from the current 4.6 percent. Sliding sales have contributed to halving EMI's shares this year to 173 pence and the company was evicted from London's FTSE 100 list of blue chip companies in September. Its stock slid 2.9 percent to 178 pence on Tuesday in London. Both of EMI's former merger contenders -- Warner Music and BMG -- have hinted recently that they were interested in attempting a deal after previously failing to win over regulators. But EMI insists it is devoted to turning around its business. EMI also sold its remaining 14.5 percent stake in British music and book store HMV on Tuesday to institutional investors for around £70 million pounds.
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