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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2023

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to

Commission file number: 001-39795

RESERVOIR MEDIA, INC.

(Exact name of registrant as specified in its charter)

Delaware

    

83-3584204

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.) 

200 Varick Street

Suite 801A

New York, New York 10014

(Address of principal executive offices, including zip code)

(212) 675-0541

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

    

Trading symbol(s)

    

Name of each exchange on which
registered

Common Stock, $0.0001 par value per share (the “Common Stock”)

RSVR

The Nasdaq Stock Market LLC

Warrants to purchase one share of Common
Stock, each at an exercise price of $11.50 per share

RSVRW

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

 

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes   No 

As of February 5, 2024, there were 64,822,260 shares of Common Stock of Reservoir Media, Inc. issued and outstanding.

Table of Contents

RESERVOIR MEDIA, INC.

FORM 10-Q FOR THE QUARTER ENDED DECEMBER 31, 2023

TABLE OF CONTENTS

    

Page

Part I. Financial Information

1

Item 1. Financial Statements

1

Condensed Consolidated Statements of (Loss) Income for the Three and Nine Months Ended December 31, 2023 and 2022 (unaudited)

1

Condensed Consolidated Statements of Comprehensive (Loss) Income for the Three and Nine Months Ended December 31, 2023 and 2022 (unaudited)

2

Condensed Consolidated Balance Sheets as of December 31, 2023 and March 31, 2023 (unaudited)

3

Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Three and Nine Months Ended December 31, 2023 and 2022 (unaudited)

4

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2023 and 2022 (unaudited)

5

Notes to Condensed Consolidated Financial Statements

6

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

16

Item 3. Quantitative and Qualitative Disclosures About Market Risk

32

Item 4. Controls and Procedures

32

Part II. Other Information

34

Item 1. Legal Proceedings

34

Item 1A. Risk Factors

34

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

34

Item 3. Defaults Upon Senior Securities

34

Item 4. Mine Safety Disclosures

34

Item 5. Other Information

34

Item 6. Exhibits

35

Part III. Signatures

36

i

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Interim Financial Statements.

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(In U.S. dollars, except share data)

(Unaudited)

 

Three Months Ended December 31,

 

Nine Months Ended December 31, 

    

2023

    

2022

    

2023

    

2022

Revenues

$

35,476,172

$

29,931,413

$

105,710,058

$

87,475,894

Costs and expenses:

Cost of revenue

13,221,974

11,750,296

41,136,237

35,665,462

Amortization and depreciation

6,342,918

5,546,301

18,613,026

16,292,145

Administration expenses

 

9,389,344

 

8,035,758

 

30,148,848

 

23,031,248

Total costs and expenses

 

28,954,236

 

25,332,355

 

89,898,111

 

74,988,855

Operating income

 

6,521,936

 

4,599,058

 

15,811,947

 

12,487,039

Interest expense

 

(5,372,285)

 

(4,098,910)

 

(15,865,324)

 

(10,579,788)

Loss on early extinguishment of debt

(914,040)

(914,040)

Gain (loss) on foreign exchange

 

264

 

56,973

 

(69,828)

 

337,659

(Loss) gain on fair value of swaps

(4,247,523)

(179,573)

(1,774,045)

4,323,207

Other income (expense), net

 

(990,488)

 

43

 

(989,952)

 

90

(Loss) income before income taxes

 

(4,088,096)

 

(536,449)

 

(2,887,202)

 

5,654,167

Income tax (benefit) expense

 

(1,226,649)

 

3,529,984

 

(872,663)

 

5,217,691

Net (loss) income

(2,861,447)

(4,066,433)

(2,014,539)

436,476

Net income attributable to noncontrolling interests

(101,612)

(340,190)

(135,797)

(230,127)

Net (loss) income attributable to Reservoir Media, Inc.

$

(2,963,059)

$

(4,406,623)

$

(2,150,336)

$

206,349

(Loss) earnings per common share (Note 13):

Basic

$

(0.05)

$

(0.07)

$

(0.03)

$

Diluted

$

(0.05)

$

(0.07)

$

(0.03)

$

Weighted average common shares outstanding (Note 13):

Basic

64,826,026

64,379,536

64,731,569

64,316,532

Diluted

64,826,026

64,379,536

64,731,569

64,765,381

See accompanying notes to the condensed consolidated financial statements.

1

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In U.S. dollars)

(Unaudited)

Three Months Ended December 31,

Nine Months Ended December 31, 

    

2023

    

2022

    

2023

    

2022

Net (loss) income

$

(2,861,447)

$

(4,066,433)

$

(2,014,539)

$

436,476

Other comprehensive income (loss):

 

 

 

 

Translation adjustments

 

2,384,683

 

4,652,084

 

1,325,726

 

(5,283,489)

Total comprehensive (loss) income

 

(476,764)

 

585,651

 

(688,813)

 

(4,847,013)

Comprehensive income attributable to noncontrolling interests

 

(101,612)

 

(340,190)

 

(135,797)

 

(230,127)

Total comprehensive (loss) income attributable to Reservoir Media, Inc.

$

(578,376)

$

245,461

$

(824,610)

$

(5,077,140)

See accompanying notes to the condensed consolidated financial statements.

2

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In U.S. dollars, except share data)

(Unaudited)

December 31, 

March 31, 

    

2023

    

2023

Assets

    

    

Current assets

 

  

 

  

Cash and cash equivalents

$

19,514,381

$

14,902,076

Accounts receivable

 

30,583,910

 

31,255,867

Current portion of royalty advances

 

13,726,825

 

15,188,656

Inventory and prepaid expenses

6,796,410

5,458,522

Total current assets

70,621,526

66,805,121

Intangible assets, net

 

644,525,473

 

617,404,741

Equity method and other investments

 

1,567,663

 

2,305,719

Royalty advances, net of current portion

56,462,194

51,737,844

Property, plant and equipment, net

604,449

 

568,339

Operating lease right of use assets, net

7,239,846

7,356,312

Fair value of swap assets

4,982,839

6,756,884

Other assets

1,339,652

1,147,969

Total assets

$

787,343,642

$

754,082,929

 

 

Liabilities

 

 

Current liabilities

Accounts payable and accrued liabilities

$

7,376,882

$

6,680,421

Royalties payable

37,403,181

33,235,235

Accrued payroll

 

1,386,230

 

1,689,310

Deferred revenue

1,937,650

2,151,889

Other current liabilities

 

8,077,446

 

10,583,794

Income taxes payable

204,987

Total current liabilities

56,181,389

54,545,636

Secured line of credit

342,455,820

311,491,581

Deferred income taxes

29,878,778

30,525,523

Operating lease liabilities, net of current portion

6,983,373

7,072,553

Other liabilities

588,745

785,113

Total liabilities

436,088,105

404,420,406

Contingencies and commitments (Note 15)

Shareholders’ Equity

Preferred stock, $0.0001 par value 75,000,000 shares authorized, 0 shares issued and outstanding at December 31, 2023 and March 31, 2023

Common stock, $0.0001 par value; 750,000,000 shares authorized, 64,813,399 shares issued and outstanding at December 31, 2023; 64,441,244 shares issued and outstanding at March 31, 2023

6,481

6,444

Additional paid-in capital

340,742,579

338,460,789

Retained earnings

12,602,384

14,752,720

Accumulated other comprehensive loss

(3,529,603)

(4,855,329)

Total Reservoir Media, Inc. shareholders’ equity

349,821,841

348,364,624

Noncontrolling interest

1,433,696

1,297,899

Total shareholders’ equity

351,255,537

349,662,523

Total liabilities and shareholders’ equity

$

787,343,642

$

754,082,929

See accompanying notes to the condensed consolidated financial statements.

3

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(In U.S. dollars, except share data)

(Unaudited)

For the Three and Nine Months Ended December 31, 2023

Common Stock

Accumulated

Additional

other

paid-in

Retained

comprehensive

Noncontrolling

Shareholders’

   

Shares

   

Amount

   

capital

   

earnings

   

loss

   

interests

   

equity

Balance, March 31, 2023

 

64,441,244

$

6,444

$

338,460,789

$

14,752,720

$

(4,855,329)

$

1,297,899

$

349,662,523

Share-based compensation

 

 

 

713,802

 

 

 

 

713,802

Vesting of restricted stock units, net of shares withheld for employee taxes

207,733

21

(689,176)

(689,155)

Reclassification of liability-classified awards to equity-classified awards

664,167

664,167

Net income (loss)

 

 

 

 

277,333

 

 

(112,780)

 

164,553

Other comprehensive income

1,139,476

1,139,476

Balance, June 30, 2023

 

64,648,977

$

6,465

$

339,149,582

$

15,030,053

$

(3,715,853)

$

1,185,119

$

351,655,366

Share-based compensation

612,235

612,235

Stock option exercises

56,466

5

288,537

288,542

Vesting of restricted stock units

105,392

11

(11)

Reclassification of liability-classified awards to equity-classified awards

80,000

80,000

Net income

535,390

146,965

682,355

Other comprehensive loss

(2,198,433)

(2,198,433)

Balance, September 30, 2023

64,810,835

$

6,481

$

340,130,343

$

15,565,443

$

(5,914,286)

$

1,332,084

$

351,120,065

Share-based compensation

612,236

612,236

Vesting of restricted stock units

2,564

Net (loss) income

(2,963,059)

101,612

(2,861,447)

Other comprehensive income

2,384,683

2,384,683

Balance, December 31, 2023

64,813,399

$

6,481

$

340,742,579

$

12,602,384

$

(3,529,603)

$

1,433,696

$

351,255,537

For the Three and Nine Months Ended December 31, 2022

Common Stock

Accumulated

Additional

other

paid-in

Retained

comprehensive

Noncontrolling

Shareholders’

   

Shares

   

Amount

   

capital

   

earnings

   

loss

   

interests

   

equity

Balance, March 31, 2022

 

64,150,186

$

6,415

$

335,372,981

$

12,213,519

$

(1,198,058)

$

1,057,467

$

347,452,324

Share-based compensation

 

359,461

359,461

Vesting of restricted stock units, net of shares withheld for employee taxes

140,138

14

(475,872)

(475,858)

Reclassification of liability-classified awards to equity-classified awards

961,429

961,429

Net income (loss)

76,039

(59,218)

16,821

Other comprehensive loss

 

 

 

 

 

(5,011,563)

 

 

(5,011,563)

Balance, June 30, 2022

 

64,290,324

$

6,429

$

336,217,999

$

12,289,558

$

(6,209,621)

$

998,249

$

343,302,614

Share-based compensation

596,184

596,184

Vesting of restricted stock units

83,580

8

(8)

Reclassification of liability-classified awards to equity-classified awards

145,000

145,000

Net income (loss)

4,536,933

(50,845)

4,486,088

Other comprehensive loss

(4,924,010)

(4,924,010)

Balance, September 30, 2022

 

64,373,904

$

6,437

$

336,959,175

$

16,826,491

$

(11,133,631)

$

947,404

$

343,605,876

Share-based compensation

605,146

605,146

Stock option exercises

11,294

1

57,712

57,713

Net (loss) income

(4,406,623)

340,190

(4,066,433)

Other comprehensive income

4,652,084

4,652,084

Balance, December 31, 2022

64,385,198

$

6,438

$

337,622,033

$

12,419,868

$

(6,481,547)

$

1,287,594

$

344,854,386

See accompanying notes to the condensed consolidated financial statements.

4

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. dollars)

(Unaudited)

    

Nine Months Ended December 31,

    

2023

    

2022

Cash flows from operating activities:

 

  

 

  

Net (loss) income

$

(2,014,539)

$

436,476

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

 

 

Amortization of intangible assets

 

18,433,037

 

16,152,354

Depreciation of property, plant and equipment

 

179,989

 

139,791

Share-based compensation

 

2,540,146

 

2,408,677

Non-cash interest charges

 

1,003,626

 

1,738,414

Loss on early extinguishment of debt

914,040

Loss (gain) on fair value of swaps

 

1,774,045

 

(4,323,207)

Impairment of equity investment

991,105

Share of earnings of equity affiliates, net of tax

(34,131)

Dividend from equity affiliates

 

 

62,304

Deferred income taxes

 

(950,760)

 

3,658,643

Changes in operating assets and liabilities:

 

 

Accounts receivable

 

671,957

 

(1,635,872)

Inventory and prepaid expenses

(1,337,888)

(1,813,272)

Royalty advances

(3,262,519)

(5,872,059)

Other assets and liabilities

349,257

(483,961)

Accounts payable and accrued expenses

4,234,773

13,307,088

Income taxes payable

(204,987)

1,548,111

Net cash provided by operating activities

22,407,242

26,203,396

Cash flows from investing activities:

Purchases of music catalogs

(46,765,596)

(45,099,964)

Investments in affiliates

(200,000)

Purchase of property, plant and equipment

(216,099)

(310,363)

Net cash used for investing activities

(47,181,695)

(45,410,327)

Cash flows from financing activities:

Proceeds from secured line of credit

34,000,000

23,182,694

Repayment of secured line of credit

(4,000,000)

Proceeds from stock option exercises

288,542

57,713

Taxes paid related to net share settlement of restricted stock units

(689,155)

(475,858)

Deferred financing costs paid

(39,387)

(3,533,253)

Net cash provided by financing activities

29,560,000

19,231,296

Foreign exchange impact on cash

(173,242)

(815,833)

Increase (decrease) in cash and cash equivalents

4,612,305

(791,468)

Cash and cash equivalents beginning of period

14,902,076

17,814,292

Cash and cash equivalents end of period

$

19,514,381

$

17,022,824

See accompanying notes to the condensed consolidated financial statements.

5

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2023

(Unaudited)

NOTE 1. DESCRIPTION OF BUSINESS

Reservoir Media, Inc. (formerly known as Roth CH Acquisition II Co. (“ROCC”)), a Delaware corporation (the “Company”), is an independent music company based in New York City, New York and with offices in Los Angeles, Nashville, Toronto, London and Abu Dhabi.

Following a business combination between ROCC and Reservoir Holdings, Inc., a Delaware corporation (“RHI”), on July 28, 2021 (the “Business Combination”), the Company’s legal name became “Reservoir Media, Inc.” The common stock, $0.0001 par value per share, of the Company (the “Common Stock”) and warrants are traded on The Nasdaq Stock Market LLC (“NASDAQ”) under the ticker symbols “RSVR” and “RSVRW,” respectively.

The Company’s activities are organized into two operating segments: Music Publishing and Recorded Music. Operations of the Music Publishing segment involve the acquisition of interests in music catalogs from which royalties are earned as well as signing songwriters to exclusive agreements which give the Company an interest in the future delivery of songs. The publishing catalog includes ownership or control rights to more than 150,000 musical compositions that span across historic pieces, motion picture scores and current award-winning hits. Operations of the Recorded Music segment involve the acquisition of sound recording catalogs as well as the discovery and development of recording artists and the marketing, distribution, sale and licensing of the music catalog. The Recorded Music operations are primarily conducted through the Chrysalis Records platform and Tommy Boy Music and include the ownership of over 36,000 sound recordings.

NOTE 2. BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiaries and have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. All intercompany transactions and balances have been eliminated in these condensed consolidated financial statements. Certain information and note disclosures typically included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s audited financial statements as of and for the fiscal years ended March 31, 2023 and 2022.

The condensed consolidated balance sheet of the Company as of March 31, 2023, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures, including certain notes required by US GAAP on an annual reporting basis.

In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations and cash flows for the interim periods. The results for the three and nine months ended December 31, 2023 are not necessarily indicative of the results to be expected for any subsequent quarter, the fiscal year ending March 31, 2024 or any other period.

The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. Significant estimates are used for, but not limited to, determining useful lives of intangible assets, intangible asset recoverability and impairment and accrued revenue. Actual results could differ from these estimates.

6

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2023

(Unaudited)

NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Standards Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which expands income tax disclosures, including requiring enhanced disclosures related to the rate reconciliation and income taxes paid information. The amendments in ASU 2023-09 should be applied on a prospective basis, with retrospective application permitted. ASU 2023-09 is effective for annual periods of public business entities for fiscal years beginning after December 15, 2024 and for annual periods of entities other than public entities beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the impact that adoption of ASU 2023-09 will have on its disclosures upon adoption.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which expands segment disclosures for public entities, including requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”), the title and position of the CODM and an explanation of how the CODM uses reported measures of segment profit or loss in assessing segment performance and allocating resources. ASU 2023-07 also expands disclosures about a reportable segment’s profit or loss and assets in interim periods and clarifies that a public entity may report additional measures of segment profit if the CODM uses more than one measure of a segment’s profit or loss. ASU 2023-07 does not remove existing segment disclosure requirements or change how a public entity identifies its operating segments, aggregates those operating segments, or determines its reportable segments. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and subsequent interim periods with early adoption permitted, and requires retrospective application to all prior periods presented in the financial statements. The Company is currently evaluating the impact that adoption of ASU 2023-07 will have on its disclosures upon adoption.

Accounting Standards Recently Adopted

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments–Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which replaces the incurred loss impairment methodology in current US GAAP with a methodology that reflects expected credit losses. Subsequent to ASU 2016-13, the FASB has issued several related ASUs amending the original ASU 2016-13. The updates are intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. For the Company, ASU 2016-13 was effective beginning April 1, 2023. The adoption of ASU 2016-13 did not have a material impact on the Company’s condensed consolidated financial statements.

NOTE 4. REVENUE RECOGNITION

For the Company’s operating segments, Music Publishing and Recorded Music, the Company accounts for a contract when it has legally enforceable rights and obligations and collectability of consideration is probable. The Company identifies the performance obligations and determines the transaction price associated with the contract. Revenue is recognized when, or as, control of the promised services or goods is transferred to the Company’s customers, and in an amount that reflects the consideration the Company is contractually due in exchange for those services or goods. Certain of the Company’s arrangements include licenses of intellectual property with consideration in the form of sales- and usage-based royalties. Royalty revenue is recognized when the subsequent sale or usage occurs using the best estimates available of the amounts that will be received by the Company. The Company recognized revenue of $3,682,276 and $3,478,970 from performance obligations satisfied in previous periods for the nine months ended December 31, 2023 and 2022, respectively. Revenue recognized from performance obligations satisfied in previous periods for the nine months ended December 31, 2022 was impacted by an update to estimated Music Publishing royalties based on the Company’s estimate of effects arising from the July 2022 ruling by the U.S. Copyright Royalty Board (the “CRB”) to affirm increases to the statutory royalty rate structure for mechanical royalties in the U.S. for the period 2018 to 2022. For much of the period between 2018 and 2022, most digital service providers accounted and submitted payment to the Company using the applicable 2017 rate while the remand process took place.

7

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2023

(Unaudited)

Disaggregation of Revenue

The Company’s revenue consisted of the following categories during the three and nine months ended December 31, 2023 and 2022:

Three Months Ended December 31, 

Nine Months Ended December 31, 

    

2023

    

2022

    

2023

    

2022

Revenue by Type

Digital

$

13,938,412

$

10,717,506

$

38,594,301

$

32,428,357

Performance

 

4,272,420

 

4,407,361

 

15,280,829

 

12,355,228

Synchronization

 

4,012,451

 

3,670,065

 

11,512,976

 

11,382,565

Mechanical

 

390,831

 

589,209

 

2,202,140

 

2,104,190

Other

 

529,496

 

770,990

 

2,252,741

 

2,394,879

Total Music Publishing

23,143,610

20,155,131

69,842,987

60,665,219

Digital

 

6,589,119

 

5,246,986

 

19,476,308

 

16,122,688

Physical

 

1,671,093

 

1,104,207

 

7,138,031

 

3,252,740

Neighboring rights

 

956,984

 

822,106

 

2,618,529

 

2,248,387

Synchronization

 

782,224

 

388,305

 

1,978,668

 

2,402,179

Total Recorded Music

9,999,420

7,561,604

31,211,536

24,025,994

Other revenue

2,333,142

2,214,678

4,655,535

2,784,681

Total revenue

$

35,476,172

$

29,931,413

$

105,710,058

$

87,475,894

Three Months Ended December 31, 

Nine Months Ended December 31, 

    

2023

    

2022

    

2023

    

2022

Revenue by Geographical Location

 

  

 

  

 

  

 

  

United States Music Publishing

$

14,063,281

$

11,187,010

$

41,435,627

$

35,946,459

United States Recorded Music

 

5,315,263

 

4,188,061

 

16,722,726

 

12,958,074

United States other revenue

 

2,333,142

 

2,214,678

4,655,535

 

2,784,681

Total United States

 

21,711,686

 

17,589,749

 

62,813,888

 

51,689,214

International Music Publishing

 

9,080,329

 

8,968,121

 

28,407,360

 

24,718,760

International Recorded Music

 

4,684,157

 

3,373,543

 

14,488,810

 

11,067,920

Total International

 

13,764,486

 

12,341,664

 

42,896,170

 

35,786,680

Total revenue

$

35,476,172

$

29,931,413

$

105,710,058

$

87,475,894

Only the United States represented 10% or more of the Company’s total revenues in the three and nine months ended December 31, 2023 and 2022.

Deferred Revenue

The following table reflects the change in deferred revenue during the nine months ended December 31, 2023 and 2022:

    

2023

    

2022

Balance at beginning of period

$

2,151,889

$

1,103,664

Cash received during period

 

3,029,695

 

4,977,624

Revenue recognized during period

 

(3,243,934)

 

(3,337,864)

Balance at end of period

$

1,937,650

$

2,743,424

8

Table of Contents

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2023

(Unaudited)

NOTE 5. ACQUISITIONS

In the ordinary course of business, the Company regularly acquires publishing and recorded music catalogs, which are typically accounted for as asset acquisitions. During the nine months ended December 31, 2023 and 2022, the Company completed such acquisitions totaling $43,816,768 and $36,264,222, respectively, inclusive of deferred acquisition payments, none of which were individually significant.

NOTE 6. INTANGIBLE ASSETS

Intangible assets subject to amortization consist of the following as of December 31, 2023 and March 31, 2023:

    

December 31, 2023