Stable Income Situation at GVL in the 2019 Financial Year

18. June 2020. 

At its ordinary Associates’ and Delegates’ Assembly on 16 June 2020, the Gesellschaft zur Verwertung von Leistungsschutzrechten mbH (GVL) presented its annual financial statements for 2019. Broadcasting remuneration remained GVL's largest source of income, closely followed by revenues from private copying. After special effects due to back payments in the previous years, GVL's income of EUR 215.5 million in 2019 still kept in line with expectations.

In 2019, GVL recorded total revenues of EUR 215.5 million (2018: EUR 229.8 million). Compared to the previous year, income fell by 6.3 percent due to the absence of the special effects in previous years.

"With revenues of well over EUR 200 million in 2019, we were again above the level of average proceeds of the last ten years," explain Guido Evers and Dr. Tilo Gerlach, Managing Directors of GVL. "The decline in income is mainly due to the absence of the special effects from private copying back payments, which still came into play in 2018. In addition to the good annual result, we are pleased that we were able to distribute a total of EUR 187 million to our rightsholders in 2019".

 

The most important figures at a glance

GVL generated the highest revenues in the area of broadcasting remuneration, at EUR 88.4 million compared to EUR 92.1 million in 2018. The slight decline of 4.1 per cent is due to subsequent payment effects in the previous year.

There was a slight decline in reproduction rights revenues of EUR 72.6 million (previous year: EUR 83.9 million). In comparison, income from public broadcasting increased slightly to EUR 42.3 million (previous year: EUR 41.4 million). Another slight increase occurred in the cable retransmission of artistic performances other than recorded music and music video clips. In 2019, these amounted to EUR 2.2 million (previous year: EUR 2.1 million). Due to declining rental and leasing uses, this income was slightly lower than in the previous year at EUR 1.8 million (2018: EUR 2.1 million).

Because of the persistently low interest rate level for new investments, interest income fell from EUR 2.2 million to EUR 2.1 million in 2019.

At EUR 21.3 million, GVL's own administrative expenses before depreciation and piracy are slightly lower than in the previous year (2018: EUR 22.1 million). However, due to the lower revenues of the previous year, the cost rate of 9.9 percent was slightly higher than in the previous year (9.6 percent).

On a positive note, GVL has slightly increased the funding for cultural projects as part of the 2019 grants. In 2019, they amounted to around EUR 3.7 million (2018: around EUR 3.6 million).

 The Transparency Report 2019 (VGG - Collecting Societies’ Act) will be published in the coming days on www.gvl.de.

 

GVL in times of corona - Outlook 2020

When the lockdown became apparent, speed was the order of the day for the GVL. In order to protect the health of its employees, the management moved all activities to home offices as early as mid-March. Even under these changed working conditions, increased intensity prevailed when it came to reaching the aim of ensuring distributions for those rightsholders who were severely affected by the crisis. At the same time, GVL was one of the first companies in the industry to respond to the plight of its rightsholders with various aid programmes as early as in March. These included advance payments in an overall eight-figure range and the corona relief, which was paid out as a social contribution to over 8,000 artists and producers.

The longer-term effects of the corona pandemic are already being felt by GVL today. Revenues have fallen dramatically, particularly in public broadcasting sector, while advertising revenues of private broadcasters have declined, as has the sale of hardware, which is important for private copying. In the medium term, the pandemic will thus have an impact on almost all the sources of GVL. In the worst case, this could result in a cut of up to 50 percent of regular income, which would have a delayed effect on distributions in the following year 2021. At present, however, no one can predict exactly what consequences the pandemic will have on the further course of the financial year. 

You can find pictures here.

 

About GVL:

Those who render artistic performances or create the respective financial basis for the latter must receive money for the exploitation of their performances. GVL, the society for the administration of neighbouring rights, captures and manages such exploitations.
GVL pays the fees it collects on a fiduciary basis from radio and TV stations, for example, and for the public performance (e.g. in restaurants or cafés) to its members in the form of a remuneration. Approximately 160,000 performers, producers of sound recordings and audiovisual recordings, music and music video clip producers as well as event organisers have placed their trust in GVL on a global level - and thus make GVL one of the biggest collective management organisations for neighbouring rights in the world. At the same time, the GVL represents the largest classical repertoire worldwide.
Associates of GVL are the German Orchestra Association (DOV), the Federal Association of the Music Industry (BVMI) as well as the Federal Acting Association (BFFS).