7digital has announced a slew of deals amongst its 2014 financial results, including a partnership with supermarket giant Sainsbury’s.
The three-year deal sees 7digital provide the platform and content for the music section of Sainsbury’s online entertainment offering, including access to 7digital’s library of over 31 million tracks, its delivery systems and platform and reporting tools for which Sainsbury’s will pay monthly fees.
Also announced is an expansion to the service’s partnership with Guvera, as the streaming service arrives in other countries. Five European territories will be launched later this year, including the UK, where 7digital is working in association with Blinkbox Music for the Guvera branded service.
Simon Cole (pictured), CEO of 7digital, commented: “I am very pleased to be able to announce both an important new customer in Sainsbury’s, with whom we look forward to working as they develop their online entertainment offering, as well as the development of our relationship with Guvera. Within a year of first doing business with together, we have developed a deep working relationship and expanded our businesses.
“Guvera is a fast moving, innovative organisation with a streamed music model that we have seen gain significant traction. I look forward especially to working with them on their new UK service following their successful acquisition of the Blinkbox service.”
7digital’s audited preliminary results for the year ending December 31, 2014 showed a total comprehensive income of £0.3 million, up from 2013’s loss of £4.5m. Part of the income came from sales in October of 29m Audioboom shares for cash proceeds of £3.52m, against an initial investment of £1.6m.
Adjusted LBITDA was reduced by 21% to £3.1m from £3.9m in 2013, ahead of expectations. Turnover was down 12% to £10.2m (£11.5m in 2013) with transition away from low margin download stores. Adjusted operating loss reduced by 15% to £3.8m (2013: £4.6m).
Cole commented: “These results represent a year in which we successfully created a new company from the merger of UBC Media and 7digital; we have ended it in a position ahead of the predictions we had made during the merger. Our success and growing customer base is proof of the developing market for streamed music services and the coming together of the radio and music industries as technology and consumer habits change.
“As our business model has changed, our high margin monthly recurring revenues and profitability continue to grow, powered by the fast growth of our existing clients and new customers wins. As the opportunities continue to grow in all of our key market sectors, the Board is confident that 7digital is well positioned to take advantage of what will be a significant demand for new streamed music and radio services globally.”