We're big fans of Sanctuary Music's business model here at CMU (and I appreciate being a fan of any business model is a bit sad), so hurrah at the news that the London based music company is performing very well, especially when put into the context of the struggling music industry. Sanctuary's revenues were up 17% in the six months prior to 31 Mar, with turnover increases of 41% and 86% in the group's recorded music and management/live divisions respectively.
As previously reported, Sanctuary is almost unique in dabbling in most key areas of the music business - including recorded music, publishing, management and live music. This allows the company to access the booming live sector, and use that revenue to support its recorded music operations. Which goes a long way to explaining the current success.
That said, the company's finance director Mike Miller reckons the quality of Sanctuary's roster also plays a part: "The major record companies do not have the right mix of artists in their repertoire. If you go back 15 or 20 years, they had a raft of artists with long careers but they lost their way in the 90s."
Continuing, Miller also stressed the importance of working with a number of high performing artists unlike some independents who rely on one or two big names for much of their income: "You only have to look at Telstar, who had a big act in Craig David but went bust. It is very difficult to run an expensive records business with one or two acts and no catalogue to keep things running along."
Miller confirmed Sanctuary were still planning on expanding. However he indicated an interest in acquiring certain publishing catalogues or unsigned but established artists, rather than buying out whole publishing companies or record labels.