Digital cash brings EMI surprise bonus: revenues from digital triple despite dip in overall profits.(Companies)

EMI has revised its projections for growth of digital revenues after the first year of business outstripped initial expectations.

The major unveiled new full-year figures last week indicating that it had achieved turnover of 15m [pounds sterling] from sales of downloads and ringtones in the 12 months to the end of March this year, three times greater than the previous year.

The 15m [pounds sterling] figure is made up of 7.7m [pounds sterling] from recorded music downloads and the other 7.3m [pounds sterling] in publishing revenues from ringtones.

The rise in sales is underlined by recorded music division revenue figures for the three most recent six-month periods, of 700,000 [pounds sterling], 2.1m [pounds sterling] and 5.6m [pounds sterling] respectively. Even by the most modest calculations, a continuation of the trend would see a figure of 30m [pounds sterling] to 40m [pounds sterling] in revenue for EMI's next financial year.

EMI Music CEO Alain Levy says such figures have encouraged the company to upgrade previous forecasts for digital music sales of 5% to 25% in five years' time; he says lie now believes such levels will be achieved within four years.

Levy says he had previously hoped to hit the 1% figure for the current financial year, although this now looks a conservative estimate. After achieving the 15m [pounds sterling] figure for 2003, digital income should easily pass 1% (around 22m [pounds sterling]) of total group revenue in a year's time, says EMI Group chairman Eric Nicoli. "22m [pounds sterling] would be disappointing against 15m [pounds sterling] for this year," he says.

Levy says the figures are particularly impressive given that Microsoft has yet to launch its rival to iTunes, while Apple is also yet to launch outside of the US. "We have seen just the tip of the iceberg in terms of distribution," he says.