All ThingsConsidered - Final Results

16 May 2024

All Things Considered Group plc

("ATC", the "Company" or the "Group")

Final Results

Significant acceleration in scale and full-service offering

All Things Considered Group plc (AQSE: ATC), the independent music company housing artist representation and music industry services, is pleased to announce audited final results for the year ended 31 December 2023 ("FY23").

Financial highlights

·	Group revenue from continuing activities of £24.1m, an increase of 156% (2022: £9.4m), including £16.2m contribution from acquisition of Sandbag in July 2023
	-	Material increase in ATC Services segment to £17.4m (2022: £2.87m) following contribution from Sandbag acquisition
	-	Artist Representation segment broadly flat at £6.65m (2022: £6.57m), with growth in ATC Management offset by small reduction in ATC Live against strong post-covid comparator
·	Operating EBITDA1 loss of £0.46m (2022: Operating EBITDA loss of £0.10 million before profit of £0.83m from one-off Services transaction), reflecting continued investment in managers and agents
·	Loss before tax of £3.04 million (2022: profit before tax £0.30 million after one -off profit from Services of £0.83 million), substantially impacted by share of results of Driift, a minority interest, as expected. This is expected to be substantially improved upon in 2024 following restructure of Driift.
·	Placing and subscription in July 2023 of £4.18m to fund the acquisition of Sandbag and provide balance sheet strength
·	Group net cash at the year end after current debt was £10.0 million (2022: net cash of £1.4 million)

Operational highlights

·	Continued strength in artist representation businesses, ATC Management and ATC Live, with more than 500 clients collectively
·	Transformative acquisition in July 2023 of 60% of Sandbag into Group's Services offering, accelerating Group's position to engage artists across multiple commercial interests and adding c.250 merchandising clients to the Group's artist relationship roster
·	Strategic partnership with Arrival Artists in North America to provide artists with global live representation has strengthened ATC Live's position as a world-leading independent live agency (now ranked 7th largest agency globally)
·	ATC Experience in advanced stage of development of its first major theatrical project, bringing together ATC artist clients and internationally recognised theatre practitioners with launch scheduled for Autumn 2024
·	The Group's minority interest in Driift remains well-funded, however livestreaming market continues to be impacted by the resumption of live touring. Strong underlying technical platform enhanced in 2023 to deliver a white label service to a broad range of live event partners, expected to deliver new revenues in 2024.

 

 

Post period end, current trading and outlook²

·	Significant advancement of Group's full-service artist offering through:
	-	Acquisition of 50% of Mckeown Asset Management in February 2024, extending Group's revenue streams into festival management, live music promotion and venue assets
	-	Acquisition of 55% of Raw Power Management on 16 May 2024, bringing a further 21 artists into the Group's management orbit, including Bullet for My Valentine, Don Broco, Kid Kapichi, The Damned and Bring Me The Horizon, recent winners of the Brit award for best Alternative/Rock Act
·	Contractual relationships with c.750 artists across Group interests, providing a broader, more diversified platform to pursue growth opportunities through multiple service engagements.
·	Robust balance sheet with successful share placing in March 2024 raising £2.3m to fund further Group-wide development. Group cash at the end of April 2024, excluding client funds and before short term debt and including the net proceeds from the recent equity fundraise, was £10.07m.
·	Normalisation of live event environment following post-covid bounce, with ATC Live on track to deliver material growth with 90% of 2024 budget already secured
·	Good trading momentum across Group, with expected Group growth, coupled with a substantial reduction in losses anticipated for minority interest in Livestreaming business, expected to deliver improved returns for shareholders.

Adam Driscoll, CEO of ATC Group plc, commented:

"The material developments realised in 2023 following a period of strategic investment have substantially enhanced the Group's position to capitalise on the multiple revenue opportunities within the disrupted and growing global music industry. The value in the music market lies with the artists and the way in which they engage directly with their fanbases. We have put together a collection of assets that sit at the heart of that strategic shift.

 

"Following this year of consolidation, we believe we have the right building blocks in place, including a larger, more diversified client base, a broader service offerings and a robust financial position. This, together with positive trading momentum into 2024, leaves us excited about the remainder of the year and the opportunities that lie beyond."

 

NOTES:

 

¹ Operating EBITDA is a non statutory performance measure, as displayed in the consolidated statement of comprehensive income, and is defined as the operating result before interest, tax, depreciation, amortisation and impairment and before the share of results of associates and joint ventures.

² From 1 January 2024 the Group's key divisions have been restructured into three key segments to better reflect the growing range of the Group's activities. These segments are as follows and include subsidiary and associated companies as at the date of this document:

·       Artist Representation (ATC Management, Raw Power Management and ATC Live)

·       Services (Sandbag, Your Army America, Familiar Music, Driift)

·       Live Events and Experiences (ATC Experience, Mckeown Asset Management)

 

Availability of shareholder documents

 

The Company's Annual Report and Accounts will shortly be available on the Company's website:  www.atcgroupplc.com

 

 

For more information, please contact:

ATC Group Via Alma Strategic Adam Driscoll, CEO Ram Villanueva, CFO  Panmure Gordon (UK) Limited  +44 (0)207 886 2500 AQSE Corporate Adviser and Broker James Sinclair-Ford / Mark Rogers / Freddie Wooding Hugh Rich / Sam Elder Alma Strategic Communications Hilary Buchanan / Justine James / Will Merison  +44(0)20 3405 0205

About ATC

ATC Group is an independent music business company operating internationally with strong business focus in the key commercial areas of music artist's business. The Group encompasses direct artist representation in the form of management and live representation, merchandising,  music promotion, live-streaming and a range of other music services.

The Group is headquartered in London, with offices in the key industry hubs of Los Angeles and New York and also in Europe.

The Group has an established, long-standing client base which, together with innovative new offerings, gives the Directors confidence that the company is well positioned to capitalise on the opportunities emerging from a disrupted music industry.

The Group's key businesses for FY23 were grouped under three segments, as follows:

 Artist Representation

·	Management (Europe and USA) - artist management and development
·	ATC Live - live event booking agency for artists

 

Services

·	Sandbag - a market leading merchandising and 'Direct to Consumer' business
·	ATC Media- providing consultancy and development services
·	Your Army USA - marketing and promotions agency specialising in dance and electronic music
·	Familiar Music - synchronisation agency placing music in films, TV, advertisements and other media
·	ATC Experience - developing live theatrical events and digital experiences with artists

 

Livestreamed events

·	Minority interest in Driift - a global livestreaming business

 

From 1 January 2024 the Group's key businesses have been restructured into segments that better reflect the growing range of the group's activities. These segments are as follows and include subsidiary and associated companies as at the date of this document:

 

·	Artist Representation (ATC Management, Raw Power Management, ATC Live)
·	Services (Sandbag, Your Army America, Familiar Music, Driift)
·	Live Events and Experiences (ATC Experience, Mckeown Asset Management)

 

For more information see: www.atcgroupplc.com

 

Co-Chairs' statement

 

2023 saw the Group consolidate its position as a leading independent music business.  The fundraise completed in July 2023 and the subsequent acquisition of Sandbag, which allows artists to sell merchandise directly to fans, further cemented the Group's strategic goal of offering a full suite of key artist services.

 

The ATC Management business reported revenue growth 6% ahead of 2022, a great achievement given the post lock-down bounce-back year of 2022 when revenue benefited from nearly all artists touring, whilst the USA artist management business added new artists and managers with a focus on strengthening the offering out of our New York office. The team in Los Angeles moved into a purpose-built space which now accommodates all the Group companies based in the west coast of the USA and provides room for future growth. The ATC Live business added new agents and artists, joining our ever-growing roster.

 

Within the Services segment, the acquisition of Sandbag was the material event for the Group. ATC Experience continued its development of its first project which has brought together a number of luminaries from the theatrical world. The project, which is still under wraps, will be announced in the autumn and will play to audiences in early 2025.  Your Army America continued its growth in the North American promotions market, having a record year with revenues up by 25%. The management team of Your Army along with ATC have launched a boutique record label focussing on EDM (electronic dance music) singles which expects to release about 40 tracks over the next financial year and in doing so build a catalogue of IP.

 

Around 500 artists were directly represented by the Artist Representation segment of the Group at year end.  The addition of Sandbag added a further c250 clients to the Group.  Several important artists share services across the businesses, the task now is to accelerate further integration and have artists serviced across all the functions of the business. The 'fly-wheel' concept is what differentiates us as a Group. Maximising this integration is the key focus for the Group.

 

We ended the year with over 200 employees, a significant increase since the beginning of the year.  A special thanks to those staff in Sandbag whose business came under new ownership in 2023.  The integration of the senior management of Sandbag into the Group's management team could not have been any better, with the synergies already being palpable.

 

Finally, congratulations to Emma Stoker who was promoted to the ATC Group board in November 2023 as our Director of Business Affairs.

 

Summary and Outlook

 

2023 was a year of consolidation of existing businesses and the acquisition of Sandbag.  In 2024 we expect to see further organic growth alongside targeted acquisitions in order to drive revenue growth and improve the Group's operating EBITDA. Senior management will be focused on strengthening the 'fly-wheel' proposition, including the expansion into live events and promotions. 

 .

 

Brian Message and Craig Newman

Co-chairs

 

 

 

CEO Review

Overview

 

2023 was the Group's second full year of trading since listing on the Aquis Growth Market in London in December 2021. It was a year of substantial activity and real momentum, and we are seeing that continuing into 2024 with today's announcements of our acquisition of a majority stake in Raw Power Management and our collaboration with Modern Sky in China being testament to the speed with which we are building the Group into a key player in the international music industry.

 

Whilst 2023 saw us further consolidate and strengthen our Artist Representation segment with the addition of new managers, agents and, most importantly, artist clients, the key commercial highlight of the year was the acquisition of a majority stake in Sandbag, a transformational development for our Services segment, which was completed on 19 July 2023. The acquisition was accompanied by the successful placing of new shares to raise £4.18 million which not only funded the Sandbag acquisition but which also provided around £1.4 million that strengthened the Company's balance sheet and provided capital for the Group's further expansion into live events and experiences.

 

The acquisition of Sandbag marked a substantial development for the Group's Services division. It has added scale and complementary services to the Group and brings real strength to our strategy of building a business that can engage with musical talent across all available revenue streams and provide a fully-integrated service empowering creators and artists to build optimal commercial structures to generate increased revenues. We are now able to offer a compelling commercial plan to artists that is hard to find elsewhere in the industry and certainly not at the scale that we offer.

Across our management, agency and D2C operations, we now have contractual relationships with around 750 artist clients.

Our cross-Group integration is being led by an excellent management team who have focus and a determination to deliver on the opportunity that lies in front of us. It has become a truism that the future power in the music market will lie with the artists and the way in which they engage directly with their fanbases. We have put together a collection of assets that sit at the heart of that strategic shift. Since our acquisition of Sandbag we have already seen the benefits of the holistic approach that we can offer to artists.

The strength of our integrated offering is attracting new business and we expect to see continued growth in two key metrics over the next 12 months - the first being the number of artists with which we have some form of commercial engagement, the second being the number of artists who use more than one of our key service lines. We anticipate this will drive top line revenues and profitability. Our task for 2024, which we are confident will be achieved, is to grow revenues across all business lines through new initiatives and cross-selling opportunities, to more than offset our additional central services overhead and return us to profit at an overall Operating EBITDA  level after a period of investment in 2023.

We are also confident that our move into the complementary areas of music promotion and live events and experiences will benefit from the substantial number of artist relationships we already have across the Group.

The management team remains strongly aligned with shareholders, with executive Board members and senior managers holding 31% of the Company's issued share capital as at 31 December 2023.

 Growth strategy

The global music industry is a multi-billion dollar market undergoing significant disruption brought about by technological innovations, changing consumer demands and the building recognition that the future power in the music market will lie with the artists and the way in which they engage directly with their fanbases. At ATC Group, we have put together a collection of assets that sit at the heart of that strategic shift. All industry income is ultimately derived from the activities of the artist and the move to being in business across all revenue categories with 'empowered creators' remains an industry trend.

The formation and investment into the Group's business platform, providing a comprehensive range of talent services, is guided by the Group's strategy to build a fully-integrated services business covering the spectrum of artists' needs. This enables the Group to align more closely with artists' commercial ambitions, capture a greater share of music industry revenue streams, and enables a virtuous circle of industry insight and proprietary data across service lines, creating substantial competitive differentiation.

 

Alongside deepening our relationships with artists across multiple service lines, we believe there is also a substantial opportunity to co-create, co-produce and deliver new IP via events and experiences, underpinned by our multi-service approach across key revenue strands. The first commercial benefits of this approach are expected to be realised during 2024.

 

Current trading

The opening months of 2024 have seen the Group continuing the momentum established in 2023. We have restructured our reporting segments to bring them more into line with the Group's developing commercial focus. As a result, we now segment our activities into Artist Representation, Services and Live Events and Experiences verticals. We are now making good on the promise of the integration of the individual strengths of these three divisions and demonstrating how we can deliver a better business approach for our clients and increased revenues and activations for the Group.

Confidence in the Group's prospects was reinforced early in 2024 with the successful completion of a £2.3m fundraise. We were delighted by the substantial support from a number of our key existing shareholders and equally pleased to be able to welcome new shareholders to the register who share the Directors' optimism about the Group's prospects.

Artist Representation

We are pleased with the continued growth of the Group's substantial Artist Representation segment. The division remains strong across both areas of representation with ATC Management and ATC Live representing c.550 clients in total.

ATC Live's relationship with Arrival Artists in North America continues to bear fruit as the combined offer of 'global live representation' assists in winning new clients. A number of ATC Live's key clients are active in touring during 2024. Given the lead times involved in touring, ATC Live has already contracted 90% of its financial forecast for 2024 so we are encouraged about the likely financial outturn for the business for this year. One of the key clients, Fontaines D.C., for example, has recently announced a tour which has generated substantial ticket sales far in excess of the previous touring cycle. In an indication of the breadth of artists that are being attracted to ATC Live's roster, two recent signings include legendary classic band Devo alongside brand new artist Good Neighbours, whose first single release has, with the aid of TikTok fan interaction, already delivered over 175 million Spotify plays.

ATC Management continues to perform well in all key markets. The UK business is looking to deliver a record year in 2024 with key clients including Nick Cave, Thom Yorke, The Smile, PJ Harvey, Faithless, Johnny Marr, Frank Carter and the Rattlesnakes and The Hives all delivering extensive touring. In the US we are continuing to recruit new managers and artists as the new Los Angeles office base continues to be complemented by growth in our recently established New York facility.

Our composer representation business had a successful 2023 and is delivering even more projects in 2024 with the roster now including such luminaries as Isobel Waller-Bridge, Jonny Greenwood, Natalie Holt and Robert Ames (co-head of the London Contemporary Orchestra).

Our Artist Representation business has been significantly bolstered by today's announcement of our acquisition of 55% of Raw Power Management, a leading UK and US artist management business which has a fantastic roster of artists including  Bullet for My Valentine, Don Broco, Kid Kapichi, The Damned and Bring Me The Horizon, recent winners of the Brit award for best Alternative/Rock Act. This acquisition is a coup for ATC, bringing a team of highly regarded managers and artists under the ATC Group umbrella and substantially strengthening our roster of internationally successful artists. The Raw Power team were attracted by the opportunities for their further growth offered by our integrated strategy and geographic reach, and we expect that our complementary skills and industry experience will prove to be a selling point for other leading managers and agents.  The Group is becoming an ever more attractive home for the industry's leading artists and their representatives.

Services

Our Services businesses, now substantially larger as a result of the recent acquisition of Sandbag, has had a promising start to 2024. Your Army America has delivered record turnover and profitability in Q1 and has complemented its promotional capabilities with the launch of a boutique record label focussing on EDM (electronic dance music) singles which expects to release about 40 tracks over the current financial year and in doing so build a catalogue of IP. Elsewhere, Familiar Music, our synchronisation agency, has delivered a number of sizeable revenue opportunities for our artist clients.

 

The integration of Sandbag into the wider Group has proceeded as smoothly and efficiently as we could have hoped. The two co-founders who remained with the business, Mel Maxwell and Christiaan Munro, have joined our senior management team and together with our other divisional heads, have been facilitating the smoother running of the Group 'fly-wheel'.

 

Sandbag, with its roster of over 250 clients, such as Radiohead, ABBA Voyage, Incubus and Glastonbury Festival, is a strong addition to the Group's base and a key plank in enabling us to deliver on the 'direct to consumer' opportunity for fan engagement that is becoming a key economic driver of the Group's business and a clear direction of travel for the music industry at large. Key ATC client, Black Country, New Road, is now serviced by ATC Management, ATC Live and Sandbag and is becoming a model for how we expect to grow our business in the future whilst providing an excellent creative and commercial service for artists across all components of their business.

Our associated livestreaming business Driift delivered fewer shows and tickets in 2023 than previously. The board of Driift chose to preserve cash balances where possible rather than taking promoter-style risks on shows and focussed more on building out the livestream platform to enable it to deliver 'white label' solutions for a range of live promoters in multiple market sectors. That refocusing means that while Driift still has a well-regarded brand in music, it also has the opportunity to generate new income streams. The business remains well financed with over £1m of net cash and a strategic review is underway to determine the most appropriate path to profitability which is expected to report before the end of H1 2024. In the meantime, an internal reorganisation has delivered substantial savings meaning that 2024 will see materially reduced losses for the business.

Live Events and Experiences

The Live Events and Experiences businesses are beginning to show real momentum. The announcement of our first theatrical project delivered by ATC Experience, will come in Autumn 2024 when tickets go on sale and the show will be open to audiences from early 2025. Whilst details of the show remain confidential, we believe that it will demonstrate the scale of our ambition in this space and will be the first of many such exciting projects in which we can participate as co-originator, producer, financier and rights holder. A second project involving one of our key management clients is currently in the development stage and we are hoping that too will be ready for initial launch in 2025.

 

The acquisition of Mckeown Asset Limited ("MAL") that was announced on 6 February 2024  is a further boost to our ambitions in the Live Events space. MAL is a UK holding company for a number of businesses across the live entertainment and music sector, including a 98% interest in Mckeown Events Limited ("MEL"), a concert and festival organiser based in Brighton; a 50% interest in  JTR Productions Ltd ("JTR") a festival management operation; a 40% interest in Something Recordings Ltd, a small indie record label; and a 10% interest in Concorde 2 Ltd ("Concorde 2"), an iconic live music venue in Brighton with a 600 person capacity, that hosts c.250 live concerts annually.

 

The team at MAL has had experience organising events around the UK for over 18 years, managing approximately 300 concerts and festivals across a broad spectrum of genres including rock, country, folk, electronica, americana, hip hop, neo classical, spoken word, and metal.  MAL has been responsible for facilitating approximately 250,000 tickets per annum across events, venues and festivals.

 

Festivals currently being serviced within the MAL group include:

 

On The Beach, Brighton, UK: 80,000 capacity, growing from 15,000 capacity in 2021

Black Deer Festival, Kent, UK: 15,000 capacity.

Brighton Psych Fest, Brighton, UK: 2,000 capacity.

 

The addition of the MAL team to the Group's operations enables us to play a more active role in the promotions and festival businesses that are so key to the economic success of artists that we represent. Together with ATC Experience, we bring both the creative and commercial impetus to the creation of new artist activations, across indoor and outdoor shows, with a range that includes festival development and touring theatre presentations.

 

Within Live Events and Experiences, the Group has also taken a small minority interest in Tupelo Festivals - a new festival investment operation set up by well-regarded festival industry veterans - which is seeking to build a fund which will invest in a range of mid-level festival operators. This will expose the Group to selective opportunities in the sector over the coming months. The Group has no current financial exposure in the business.

 

Finally, we are delighted to announce our new co-operation agreement with Modern Sky, one of China's longest established and leading independent music companies. There are two core principles of the partnership. The first is to enable a selection of suitable artists from the ATC roster of talent (management, live and merch) to grow their business in China and the second is for ATC to help to grow the Modern Sky brand and its roster of talent and events outside China with a particular initial emphasis on the UK and US.

 

Given ATC's structure, we see this partnership benefitting all segments of our business - Artist Representation, Live Events (where we believe there are opportunities to bring some of Modern Sky's existing events from China into new territories) and for Services where we expect to establish a mutually beneficial network merchandising services - e-commerce, touring, print-on-demand, and fulfilment - for priority artists from both rosters in each of the respective markets.  

 

Outlook

 

In summary, the Group continues to show substantial momentum. A little over 2 years ago ATC was primarily a well regarded artist representation business with a substantial set of management and live clients. Since the Aquis IPO we have enhanced the artist representation business with the addition of a large number of new managers, clients and agents and charged that growth further with a partnership with Arrival Artists in ATC Live and the addition of Raw Power Management.

 

We have hugely extended our Services component with the addition of Sandbag and the continued growth of Your Army America. We have moved into Live Experiences with what we hope will be an attention-grabbing first project launching this Autumn. We have added a live promoter arm to the business. We have expanded our geographical reach with a new office in New York and a new partnership in China. We have a dedicated internal team working on the services offer and integration that we can deliver to the 750 artist clients who are in business with the Group.

We have also developed a strong and supportive shareholder base and we remain grateful for the support that has been shown as we develop the Group's service offering. We are excited about the remainder of 2024 and the opportunities that lie beyond.

 

Adam Driscoll

CEO

 

 

 

CFO review

 

Overview

2023 saw the Group ending the year with materially improved net cash (gross cash balances less client funds less current borrowings and current lease liabilities) of £10.0 million (2022: £1.4m). This positive change was delivered by a combination of improvements including operating cashflow, the equity fundraise completed in July 2023 and the acquisition of Sandbag Limited. Sandbag contributed £8.2 million in cash at the date of acquisition. As a result, the balance sheet position was strengthened during the year.

2023 also saw significant Group revenue growth with total revenue increasing from £9.45 million in 2022 to £24.06 million in 2023. The contribution from Sandbag, the largest acquisition since our IPO, was a significant factor in this growth and it will continue to be a material component of Group revenue in 2024 and beyond.

In Operating EBITDA terms, 2023 delivered a loss of £0.46 million compared to an operating EBITDA profit of £0.73 million in 2022, which included a one-off Services transaction with net profit of £0.83m in that year.  The Group's loss before tax widened to £3.04 million in 2023 which was principally due to the share of results in our associates and joint ventures. Our minority investment in Driift, the livestreaming business, has contributed a substantial proportion of these losses via our share of its trading results and a decision to impair our carrying value of Driift which  increased via the gain on disposal of our controlling interest in 2022. Other impairments on certain investments together with the amortisation charge required under IFRS on the intangible asset value of customer relationships acquired as a result of the  Sandbag transaction also increased the loss.. The Group will be required to continue to amortise the customer relationships asset of Sandbag which is a non-cash item and therefore a better reflection of our trading position is given by the operating EBITDA metric.

In 2024 we believe ATC is set to deliver continued growth. 2023 was an important year in terms of building out the comprehensive commercial platform that we now offer to artists. The post-Covid surge in activity for touring artists in our Artist Representation businesses resulted in a substantial number of our clients being on the road in 2022. This dipped very slightly in 2023 but we are seeing an uplift again in 2024 and, given the broadening portfolio of clients that the Group represents, we are also now seeing the flattening of the ebb and flow of clients that was a factor in 2023. Current momentum is positive and, as the Group continues to scale the business, we have been delivering on a number of key milestones that will augment our growth. These include the successful equity fundraising rounds completed in July 2023 and March 2024 and the acquisitions that have been completed in 2023 and 2024 which have further bolstered the Group's competitive position.

 

 Key Performance Indicators

The Group monitors a number of Key Performance Indicators (KPIs) including the following: revenue, operating EBITDA, profit/loss before and after tax, net cash balances and the number of artists represented. These are commented on in this Strategic Report.

General

The comparatives for FY22 have been re-presented to show Driift's results and the gain on  disposal of controlling interest as a single line, Discontinued operations, as Driift became an associated undertaking on 1 October 2022 following the Deezer transaction reported last year.

 

Revenue

 The Group's consolidated revenue increased significantly to £24.06 million (2022:  £9.45 million).      

The segmental analysis is shown below :

 

		2023		2022
		£		£
Artist representation		6,647,968		6,571,428
Services (excluding one-off revenue in 2022)*		17,412,830		1,130,970
Services - One off revenue**		-		1,743,633
		24,060,798		9,446,031
* On 19 July 2023, the Group acquired a controlling 60% stake in Sandbag Limited which contributed £16.27 million of revenue in 2023.   ** The Services division earned significant one-off revenue of $2.3 million (£1.74million) in March 2022 from facilitating the acquisition of streaming platform, Napster. The division earned gross profit of $1.15m (£0.825m) from this transaction.   .

 Artist Representation

The revenue of our Artist Representation segment increased by 1.2% from £6.57 million in 2022 to £6.65 million in 2023, attributable mainly to the following:

·      ATC Management: ATC Management in the UK and USA demonstrated good revenue growth, achieving a 6% increase. The division's revenue reached £3.91 million, up from £3.69 million in 2022. This can be attributed to ATC Management's focus on bolstering its roster of new managers and artists. By nurturing talent and expanding its network, the division capitalised on market opportunities effectively.

 

·      ATC Live: There was a decline of 4% in revenue during 2023 with a small number of key clients between touring cycles.  This position will be reversed in 2024 with bigger clients out on the road again and a strengthened roster as a result of recruiting new agents and clients in 2023. ATC Live generated £2.14 million of revenue in 2023, compared to £2.22 million in 2022. ATC Live is forecasting materially increased turnover for 2024 and has already contracted nearly 90% of its budgeted figure so we remain confident about the continuing pattern of growth for the business.

Services

The Group witnessed a significant increase in underlying Services revenue during 2023, driven by the acquisition of Sandbag Limited, a merchandising business which puts the Group firmly in the 'Direct to Fan' commerce sector. Sandbag contributed £16.27 million to revenue in 2023, significantly bolstering the Group's overall Services segment.  The acquisition of Sandbag has enhanced revenue and opened up new avenues for integrated services within the Group. The opportunity to now deliver a comprehensive set of commercial services for artists is enabling the Group to win more clients and improve the integration with existing ones.

US based Your Army America ('YAA'), which provides DJ promotion services across both club and radio divisions, continued to perform well.   The division achieved an impressive 25% growth in revenue during 2023, reaching £0.96 million (2022: £0.77m).   YAA also launched its own label imprint which will enable the Group to generate intellectual property rights in the electronic music space. We anticipate releasing as many as 40 tracks in 2024 and will have the marketing collateral provided by YAA to support those releases and generate market exposure.

Livestreamed events

As noted above, the livestreaming sector has experienced challenges since the resumption of live touring following the end of the Covid pandemic. All indications still point to livestreaming being an important element of the global music industry but there is a necessary resetting of the commercial terms of engagement with artist as livestreaming becomes an addition to the touring cycle rather than a replacement for it. Driift, in which the Group holds a 32.5% minority interest, remains well funded. During 2023 the business built a comprehensive technology platform for the delivery of livestreaming services and is now able to offer that as a white label solution to events outside of music.   That is beginning to generate new revenue streams.

The board of Driift has been engaged in a comprehensive restructuring process to improve the position of the company as a commercially sustainable enterprise. We expect to see materially reduced losses and revenue growth in 2024

Other developments

From 1 January 2024, the Group has been reorganised  into three key distinct reporting segments :Artist Representation, Services, Live Events and Experiences.  This better reflects the growing range of the Group's services and it enables us to streamline operations and enhance clarity in our reporting processes.

Operating EBITDA (loss)/profit and (loss)/profit before tax

Operating (loss)/profit before depreciation, amortisation and impairment ('Operating EBITDA')

Note:   Operating EBITDA is a non-statutory performance measure that the Group monitors closely as part of  its management reporting function. It is defined as the operating result before interest, tax, depreciation, amortisation and impairment and before the share of results of associates and joint ventures.

The operating EBITDA loss in 2023 amounted to £0.46 million (2022: Operating loss of £0.10 million before one-off Services transaction).

The segmental analysis is shown below:

			2023		2022
			£		£
Artist representation			(138,020)		617,890
Services (excluding one-off Services net profit in 2022)			150,998		(321,510)
Central costs			(475,226)		(395,740)
Operating EBITDA (loss) before one-off Services			(462,248)		(99,360)
Services - One off (See note under revenue section)			-		825,205
Operating EBITDA (loss)/profit			(462,248)		725,845

The decrease in operating EBITDA is principally due to the Artist Representation segment performance which saw broadly similar levels of turnover to 2022 but  increased its cost base as the businesses brought in new managers and artists who will deliver income in the future.    

As previously noted, in 2022 Artist Representation experienced strong revenue and profitability growth, primarily driven by the resumption of live touring activities with several of our major acts contributing to higher revenue during the year.  2023 saw a number of those artists being 'off cycle'. A return to growth is expected in 2024. Additionally, our decision to invest in our US artist representation business resulted in higher fixed costs. This is the largest global music market and we expect to see our investment pay off in future periods. The addition of Raw Power Management to the Group in May 2024 demonstrates that our trans-Atlantic footprint is enabling us to expand our roster and reach.

 

(Loss)/profit before tax

The loss before tax amounted to £3.04 million (2022:  profit before tax £0.30 million, including one -off profit from Services transaction of £ 0.83 million).

As noted, we regard operating EBITDA as the best metric to reflect the continuing financial performance of the Group. The (loss)/profit before tax has been substantially impacted by non-trading items and our share of the results of associates and JVs. In particular the results include a £1.64 million share of losses in Driift (Livestreamed events) and provisions for impairment on certain investments totalling to £0.38 million.

The segmental analysis of the (loss)/profit before tax is shown below:

		2023		2022
		£		£
Artist representation*		(517,559)		542,043
Services (excluding one-off Services)		(402,865)		(337,019)
Central costs		(475,226)		(437,421)
(Loss) before tax, Livestreamed events and one-off Services		(1,395,650)		(232,397)
Livestreamed events**		(1,641,601)		(290,994)
Services - one off  (see note under revenue section)		-		825,205
(Loss)/profit  before tax		(3,037,251)		301,814

 

*  This includes impairment of investment in ATC 4  LLP, a JV partner,  amounting to  £0.28 million due to its planned closure in 2024.   ** The share of losses of Driift in 2023 include  impairment of goodwill of £0.885 million.

Net cash position

The Group's net cash after current debt was £10.0 million (2022: net cash of £1.4 million) while the Group's net cash position after non-current debt was £8.6 million (2022: net cash of £0.073 million). 

Strong cash generation during the year driven by operating cash improvements, equity fundraising and the acquisition of Sandbag which brought cash resources into the Group. Group cash at the end of the year, excluding client funds and before short term debt, amounted to £10.7m (2022: £1.7m).

The strengthened cash position was driven by operating cashflow improvements, the equity fundraising and the acquisition of Sandbag which contributed £ 8.2 million of cash at the date of acquisition.

		2023		2022
		£		£
Cash and cash equivalents		12,988,585		3,917,270
Funds held on behalf of clients		(2,324,141)		(2,172,873)
Own funds		10,664,444		1,744,397
Short-term debt:
Borrowings		(378,822)		(209,188)
Right of use lease liabilities		(262,326)		(143,794)
Net cash after current debt		10,023,296		1,391,415
Long -term debt:
Borrowings*		(1,175,217)		(1,214,057)
Right of use liabilities		(265,626)		(104,444)
		(1,440,843)		(1,318,501)
Net cash after long term debt		8,582,453		72,914

 

* £0.85m of the long-term debt is owed to a related party and is payable over the period to 2030.

Earnings per share

Basic and diluted loss per share from all activities was 25.24 pence per share (2022: earnings per share of 27.10 pence per share).

Basic earnings per share is calculated by dividing the profit/loss after tax attributable to the equity holders of All Things Considered Group Plc by the weighted numbers of shares in issue during the year.

Going Concern

The accounts have been prepared on a going concern basis.   The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, based on the projections for at least twelve months from the date of approval of the accounts.

Ram Villanueva

CFO

 

 

 

 

Consolidated statement of comprehensive income

For the year ended 31 December 2023

 

			2023		2022
	Notes		£		£
Revenue	4		24,060,798		9,446,031
Cost of sales			(16,158,427)		(3,084,378)
Gross profit			7,902,371		6,361,653
Other operating income			282,704		192,937
Administrative expenses before depreciation, amortisation and impairment			(8,647,323)		(5,828,745)
Operating (loss)/profit before depreciation, amortisation and impairment ("Operating EBITDA")			(462,248)		725,845
Depreciation, amortisation and impairment	6		(650,228)		(133,377)
Total administration expenses			(9,297,551)		(5,962,122)
Operating (loss)/profit	6		(1,112,476)		592,468
Share of results of associates and joint ventures	11		(1,837,302)		(165,729)
Finance income			14,322		3,000
Finance charges			(101,795)		(127,925)
(Loss)/profit before tax			(3,037,251)		301,814
Income tax	8		(24,057)		(77,931)
(Loss)/profit after tax			(3,061,308)		223,883
Discontinued operations	3		-		2,220,177
(Loss)/profit for the year			(3,061,308)		2,444,060
Other comprehensive income:
Items that will not be reclassified to profit and loss:
Revaluation of unlisted investments			18,092		(42,283)
Currency translation differences and others			(34,709)		(13,001)
Total other comprehensive income			(16,617)		(55,284)
Total  comprehensive income for the year			(3,077,925)		2,388,776
(Loss)/profit for the year attributable to:
- Parent company			(2,943,613)		2,596,921
- Non-controlling interests	13		(117,695)		(152,861)
			(3,061,308)		2,444,060
Total comprehensive income for the year is attributable to:
- Parent company			(2,960,230)		2,541,637
- Non-controlling interests	13		(117,695)		(152,861)
			(3,077,925)		2,388,776
(Loss)/Earnings per share			Total		Total
			Pence		Pence
Basic and diluted (pence)	7		(25.24)		27.10

 

 

 

 

Consolidated statement of financial position

As at 31 December 2023

	Notes		2023		2022
ASSETS			£		£
Non-current assets
Intangible assets	9		5,051,790		1,111,400
Property, plant and equipment			740,557		303,504
Investments	11		672,410		2,670,497
			6,464,757		4,085,401
Current assets
Inventories			763,012		-
Trade and other receivables			4,673,995		2,669,395
Cash and cash equivalents			12,988,585		3,917,270
			18,425,592		6,586,665
Total assets			24,890,349		10,672,066
LIABILITIES
Current liabilities
Trade and other payables			15,276,123		4,609,210
Income tax payable			195,061		77,525
Borrowings			378,822		209,188
Lease liabilities			262,326		143,794
			16,112,332		5,039,717
Non-current liabilities
Borrowings			1,175,217		1,214,057
Other creditors			77,008		59,438
Deferred tax liability	8		772,855		-
Lease liabilities			265,626		104,444
Financial instrument - put and call option	10		1,231,237		-
			3,521,943		1,377,939
Total liabilities			19,634,275		6,417,656
Net assets			5,256,074		4,254,410
EQUITY
Called up share capital	12		141,029		95,840
Share premium account	13		7,809,766		3,983,970
Merger reserve	13		2,883,611		2,883,611
Currency translation reserve	13		(33,258)		1,451
Retained earnings			(6,698,184)		(2,727,652)
Equity attributable to the shareholders of the parent company			4,102,964		4,237,220
Non-controlling interests	13		1,153,110		17,190
Total equity			5,256,074		4,254,410