Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 30, 2022 | Aug. 01, 2022 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-39795 | |
Entity Registrant Name | RESERVOIR MEDIA, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-3584204 | |
Entity Address, Address Line One | 75 Varick Street | |
Entity Address, Address Line Two | 9th Floor | |
Entity Address, City or Town | NY | |
Entity Address State Or Province | NY | |
Entity Address, Postal Zip Code | 10013 | |
City Area Code | 212 | |
Local Phone Number | 675-0541 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 64,373,904 | |
Entity Central Index Key | 0001824403 | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Common Stock | ||
Title of 12(b) Security | Common Stock, $0.0001 par value per share (the “Common Stock”) | |
Trading Symbol | RSVR | |
Security Exchange Name | NASDAQ | |
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share | ||
Title of 12(b) Security | Warrants to purchase one share of CommonStock, each at an exercise price of $11.50 per share | |
Trading Symbol | RSVRW | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||
Revenues | $ 24,278,770 | $ 16,632,631 |
Costs and expenses: | ||
Cost of revenue | 9,975,131 | 7,692,387 |
Amortization and depreciation | 5,361,503 | 4,059,723 |
Administration expenses | 7,621,610 | 4,664,830 |
Total costs and expenses | 22,958,244 | 16,416,940 |
Operating income | 1,320,526 | 215,691 |
Interest expense | (2,976,060) | (2,779,052) |
Gain (loss) on foreign exchange | 107,343 | (18,321) |
Gain on fair value of swaps | 1,570,337 | 547,488 |
Interest and other income | 13 | 68 |
Income (loss) before income taxes | 22,159 | (2,034,126) |
Income tax expense (benefit) | 5,338 | (527,145) |
Net income (loss) | 16,821 | (1,506,981) |
Net loss attributable to noncontrolling interests | 59,218 | 53,983 |
Net income (loss) attributable to Reservoir Media, Inc. | $ 76,039 | $ (1,452,998) |
Earnings (loss) per common share (Note 15): | ||
Basic | $ 0 | $ (0.05) |
Diluted | $ 0 | $ (0.05) |
Weighted average common shares outstanding (Note 15): | ||
Basic | 64,223,531 | 28,539,299 |
Diluted | 64,781,739 | 28,539,299 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net income (loss) | $ 16,821 | $ (1,506,981) |
Other comprehensive income (loss): | ||
Translation adjustments | (5,011,563) | 215,142 |
Total comprehensive loss | (4,994,742) | (1,291,839) |
Comprehensive loss attributable to noncontrolling interests | 59,218 | 53,983 |
Total comprehensive loss attributable to Reservoir Media, Inc. | $ (4,935,524) | $ (1,237,856) |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 12,570,147 | $ 17,814,292 |
Accounts receivable | 25,604,221 | 25,210,936 |
Current portion of royalty advances | 13,539,768 | 12,375,420 |
Inventory and prepaid expenses | 4,533,111 | 4,041,471 |
Total current assets | 56,247,247 | 59,442,119 |
Intangible assets, net | 564,416,843 | 571,383,855 |
Equity method and other investments | 3,676,072 | 3,912,978 |
Royalty advances, net of current portion | 50,392,471 | 44,637,334 |
Property, plant and equipment, net | 359,633 | 342,080 |
Operating lease right of use assets, net | 2,002,931 | |
Fair value of swap assets | 5,562,139 | 3,991,802 |
Other assets | 662,110 | 559,922 |
Total assets | 683,319,446 | 684,270,090 |
Current liabilities | ||
Accounts payable and accrued liabilities | 5,351,476 | 4,436,943 |
Royalties payable | 26,269,490 | 21,235,815 |
Accrued payroll | 388,080 | 1,938,281 |
Deferred revenue | 725,438 | 1,103,664 |
Other current liabilities | 3,387,361 | 12,272,577 |
Income taxes payable | 116,324 | 77,496 |
Total current liabilities | 36,238,169 | 41,064,776 |
Secured line of credit | 277,428,149 | 269,856,169 |
Deferred income taxes | 24,040,179 | 24,884,170 |
Operating lease liabilities, net of current portion | 1,404,826 | |
Other liabilities | 905,509 | 1,012,651 |
Total liabilities | 340,016,832 | 336,817,766 |
Contingencies and commitments (Note 17) | ||
Shareholders' Equity | ||
Preferred stock, $0.0001 par value 75,000,000 shares authorized, 0 shares issued and outstanding at June 30, 2022 and March 31, 2022 | ||
Common stock, $0.0001 par value; 750,000,000 shares authorized, 64,290,324 issued and outstanding at June 30, 2022; 64,150,186 issued and outstanding at March 31, 2022 | 6,429 | 6,415 |
Additional paid-in capital | 336,217,999 | 335,372,981 |
Retained earnings | 12,289,558 | 12,213,519 |
Accumulated other comprehensive loss | (6,209,621) | (1,198,058) |
Total Reservoir Media, Inc. shareholders' equity | 342,304,365 | 346,394,857 |
Noncontrolling interest | 998,249 | 1,057,467 |
Total shareholders' equity | 343,302,614 | 347,452,324 |
Total liabilities and shareholders' equity | $ 683,319,446 | $ 684,270,090 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2022 | Mar. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value, (per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares, authorized | 75,000,000 | 75,000,000 |
Preferred stock, shares, issued | 0 | 0 |
Preferred stock, shares, outstanding | 0 | 0 |
Common shares, par value, (per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares, authorized | 750,000,000 | 750,000,000 |
Common stock, shares, issued | 64,290,324 | 64,150,186 |
Common stock, shares, outstanding | 64,290,324 | 64,150,186 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) | Preferred Stock | Common Stock | Additional paid-in capital | Retained earnings (accumulated deficit) | Accumulated other comprehensive income (loss) | Noncontrolling interests | Total |
Beginning balance at Mar. 31, 2021 | $ 81,632,500 | $ 2,854 | $ 110,496,300 | $ (863,108) | $ 2,096,358 | $ 1,005,697 | $ 194,370,601 |
Beginning balance (in shares) at Mar. 31, 2021 | 16,175,406 | 28,539,299 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Share-based compensation | 25,675 | 25,675 | |||||
Net income (loss) | 0 | (1,452,998) | (53,983) | (1,506,981) | |||
Other comprehensive income (loss) | 0 | 215,142 | 215,142 | ||||
Ending balance at Jun. 30, 2021 | $ 81,632,500 | $ 2,854 | 110,521,975 | (2,316,106) | 2,311,500 | 951,714 | 193,104,437 |
Ending balance (in shares) at Jun. 30, 2021 | 16,175,406 | 28,539,299 | |||||
Beginning balance at Mar. 31, 2022 | $ 6,415 | 335,372,981 | 12,213,519 | (1,198,058) | 1,057,467 | 347,452,324 | |
Beginning balance (in shares) at Mar. 31, 2022 | 64,150,186 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Share-based compensation | 359,461 | 359,461 | |||||
Vesting of restricted stock units, net of shares withheld for employee taxes | $ 14 | (475,872) | (475,858) | ||||
Vesting of restricted stock units, net of shares withheld for employee taxes (in shares) | 140,138 | ||||||
Reclassification of liability-classified awards to equity-classified awards | 961,429 | 961,429 | |||||
Net income (loss) | 76,039 | (59,218) | 16,821 | ||||
Other comprehensive income (loss) | (5,011,563) | (5,011,563) | |||||
Ending balance at Jun. 30, 2022 | $ 6,429 | $ 336,217,999 | $ 12,289,558 | $ (6,209,621) | $ 998,249 | $ 343,302,614 | |
Ending balance (in shares) at Jun. 30, 2022 | 64,290,324 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 16,821 | $ (1,506,981) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Amortization of intangible assets | 5,315,265 | 4,028,444 |
Depreciation of property, plant and equipment | 46,238 | 31,279 |
Share-based compensation | 765,503 | 25,675 |
Non-cash interest charges | 578,955 | 218,498 |
Gain on fair value of swaps | (1,570,337) | (547,488) |
Share of earnings of equity affiliates, net of tax | (25,721) | |
Dividend from equity affiliates | 6,168 | 8,088 |
Deferred income taxes | 20,020 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (393,285) | 1,823,488 |
Inventory and prepaid expenses | (491,640) | (2,382,719) |
Royalty advances | (6,919,485) | (3,868,620) |
Other assets and liabilities | 96,506 | |
Accounts payable and accrued expenses | 4,339,141 | 5,891,735 |
Income tax payable | 38,828 | 442 |
Net cash provided by operating activities | 1,802,957 | 3,741,861 |
Cash flows from investing activities: | ||
Purchases of music catalogs | (12,708,782) | (112,178,528) |
Investment in equity method and other investments | (500,000) | |
Purchase of property, plant and equipment | (63,791) | (21,308) |
Net cash used for investing activities | (12,772,573) | (112,699,836) |
Cash flows from financing activities: | ||
Proceeds from secured line of credit | 7,000,000 | 32,900,000 |
Repayments of secured loans | (250,000) | |
Taxes paid related to net share settlement of restricted stock units | (475,858) | |
Deferred financing costs paid | (6,975) | |
Draws on related party loans | 80,913,620 | |
Net cash provided by financing activities | 6,517,167 | 113,563,620 |
Foreign exchange impact on cash | (791,696) | 209,139 |
(Decrease) increase in cash and cash equivalents | (5,244,145) | 4,814,784 |
Cash and cash equivalents beginning of period | 17,814,292 | 9,209,920 |
Cash and cash equivalents end of period | $ 12,570,147 | $ 14,024,704 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 3 Months Ended |
Jun. 30, 2022 | |
DESCRIPTION OF BUSINESS | |
DESCRIPTION OF BUSINESS | NOTE 1. DESCRIPTION OF BUSINESS Reservoir Media, Inc. (formerly known as Roth CH Acquisition II Co. (“ ROCC Company On July 28, 2021 (the “ Closing Date RHI Merger Agreement Merger Sub Business Combination Common Stock NASDAQ The Business Combination was accounted for as a reverse recapitalization, with RHI determined to be the accounting acquirer and the Company as the acquired company for accounting purposes. All historical financial information presented in the unaudited condensed consolidated financial statements represents the accounts of RHI and its consolidated subsidiaries as if RHI is the predecessor to the Company. See Note 4, “ Business Combination and PIPE Investment 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 140,000 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, LLC (“ Tommy Boy Acquisitions COVID-19 Pandemic In March 2020, the World Health Organization characterized the coronavirus (“ COVID-19 Although the Company has not made material changes to any estimates or judgments that impact its consolidated financial statements as a result of COVID-19, the extent to which the COVID-19 pandemic may impact the Company will depend on future developments, which are highly uncertain and cannot be predicted. Future developments surrounding the COVID-19 pandemic could negatively affect the Company’s operating results, including reductions in revenue and cash flow and could impact the Company’s impairment assessments of accounts receivable or intangible assets, which may be material to our consolidated financial statements. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Jun. 30, 2022 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | 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 US GAAP The condensed consolidated balance sheet of the Company as of March 31, 2022, 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 months ended June 30, 2022 are not necessarily indicative of the results to be expected for any subsequent quarter, the fiscal year ending March 31, 2023 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. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Jun. 30, 2022 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-03, “ Financial Instruments–Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ASU 2016-03 In April 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform (Topic 848) ASU 2020-04 Accounting Standards Recently Adopted In February 2016, the FASB issued Accounting Standards Update (“ ASU Leases (Topic 842) ASU 2016-02 Leases ASC 842 ROU effective date The new guidance also provides several practical expedients and policies that companies may elect. The Company elected the package of practical expedients under which it did not reassess the classification of its existing leases, reevaluate whether any expired or existing contracts are or contain leases or reassess initial direct costs under the new guidance. Rather, the Company retained the conclusions reached for these items under ASC Topic 840, Leases Upon its transition to the new guidance, the Company recognized approximately $2.1 million of operating lease liabilities and corresponding ROU assets. As the rates implicit in the Company’s leases are not readily determinable, the Company used its incremental borrowing rate based on the information available at the effective date to determine the present value of lease payments. This rate is based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments. The adoption of this new guidance will not have a material impact on the amount or timing of the Company’s cash flows or liquidity. In December 2019, the FASB issued ASU 2019-12, “ Simplifying the Accounting for Income Taxes ASU 2019-12 |
BUSINESS COMBINATION AND PIPE I
BUSINESS COMBINATION AND PIPE INVESTMENT | 3 Months Ended |
Jun. 30, 2022 | |
BUSINESS COMBINATION AND PIPE INVESTMENT | |
BUSINESS COMBINATION AND PIPE INVESTMENT | NOTE 4. BUSINESS COMBINATION AND PIPE INVESTMENT As discussed in Note 1, “ Description of Business Immediately prior to the consummation of the Business Combination, each share of Series A preferred stock, par value $0.00001 per share, of RHI (the “ RHI Preferred Stock RHI Common Stock RHI Preferred Stock Conversion Exchange Ratio an “ RMI Exchanged Option In connection with the Business Combination, ROCC entered into subscription agreements with certain accredited investors (the “ PIPE Investors ROCC Common Stock PIPE Investment Approximately $20,900,000 of transaction fees and expenses were incurred in connection with the closing of the Business Combination and the PIPE Investment, which have been accounted for as a reduction in proceeds. A portion of the proceeds from the Business Combination and the PIPE Investment was used to pay transaction fees and expenses, and approximately $81,300,000 was used to retire the Tommy Boy Related Party Notes (as defined below) and related accrued interest, repay the secured loan outstanding in an amount of $18,250,000 and make a payment totaling $36,750,000 on the secured line of credit in connection with a refinancing of the Previous Credit Facilities. See Note 9, “ Secured Line of Credit On the Closing Date, the Company also amended and restated its certificate of incorporation to adjust the number of its authorized shares of capital stock to 750,000,000 shares of Common Stock and 75,000,000 shares of preferred stock. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Jun. 30, 2022 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | NOTE 5. 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 $ 1,038,536 and $ 82,148 from performance obligations satisfied in previous periods for the three months ended June 30, 2022 and 2021, respectively. Disaggregation of Revenue The Company’s revenue consisted of the following categories during the three months ended June 30, 2022 and 2021: Three Months Ended June 30, 2022 2021 Revenue by Type Digital $ 8,463,870 $ 6,610,811 Performance 3,536,424 2,649,213 Synchronization 3,299,346 1,941,916 Mechanical 514,468 408,967 Other 632,599 592,866 Total Music Publishing 16,446,707 12,203,773 Digital 4,563,542 2,811,841 Physical 1,297,178 966,637 Neighboring rights 685,349 327,275 Synchronization 1,024,642 102,042 Total Recorded Music 7,570,711 4,207,795 Other revenue 261,352 221,063 Total revenue $ 24,278,770 $ 16,632,631 Three Months Ended June 30, 2022 2021 Revenue by Geographical Location United States Music Publishing $ 9,843,294 $ 6,823,175 United States Recorded Music 3,802,836 1,570,937 United States other revenue 261,352 221,063 Total United States 13,907,482 8,615,175 International Music Publishing 6,603,413 5,380,598 International Recorded Music 3,767,875 2,636,858 Total International 10,371,288 8,017,456 Total revenue $ 24,278,770 $ 16,632,631 Only the United States represented 10% or more of the Company’s total revenues in the three months ended June 30, 2022 and 2021. Deferred Revenue The following table reflects the change in deferred revenue during the three months ended June 30, 2022 and 2021: June 30 2022 June 30 2021 Balance at beginning of period $ 1,103,664 $ 1,337,987 Cash received during period 156,140 898,661 Revenue recognized during period (534,366) (392,605) Balance at end of period $ 725,438 $ 1,844,043 |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Jun. 30, 2022 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 6. 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 three months ended June 30, 2022 and 2021, the Company completed such acquisitions totaling $3,391,376 and $111,070,099, respectively, inclusive of deferred acquisition payments. The Company did not complete any individually significant acquisition transactions during the three months ended June 30, 2022. On June 2, 2021, the Company acquired U.S. based record label and music publishing company Tommy Boy for approximately $100 million, which was the most significant acquisition transaction during the three months ended June 30, 2021. Two members of the Company’s board of directors (the “ Board |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Jun. 30, 2022 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | NOTE 7. INTANGIBLE ASSETS Intangible assets subject to amortization consist of the following as of June 30, 2022 and March 31, 2022: June 30, 2022 March 31, 2022 Intangible assets subject to amortization: Publishing and recorded music catalogs $ 652,123,466 $ 654,284,671 Artist management contracts 876,509 947,723 Gross intangible assets 652,999,975 655,232,394 Accumulated amortization (88,583,132) (83,848,539) Intangible assets, net $ 564,416,843 $ 571,383,855 Straight-line amortization expense totaled $5,315,265 and $4,028,444 in the three months ended June 30, 2022 and 2021, respectively. |
ROYALTY ADVANCES
ROYALTY ADVANCES | 3 Months Ended |
Jun. 30, 2022 | |
ROYALTY ADVANCES | |
ROYALTY ADVANCES | NOTE 8. ROYALTY ADVANCES The Company made royalty advances totaling $10,227,209 and $6,258,299 during the three months ended June 30, 2022 and 2021, respectively, recoupable from the writer’s or artist’s share of future royalties otherwise payable, in varying amounts. Advances expected to be recouped within the next twelve months are classified as current assets, with the remainder classified as noncurrent assets. June 30, 2022 June 30, 2021 Balance at beginning of period $ 57,012,754 $ 41,582,080 Additions 10,227,209 6,258,299 Recoupments (3,307,724) (2,389,679) Balance at end of period $ 63,932,239 $ 45,450,700 |
SECURED LINE OF CREDIT
SECURED LINE OF CREDIT | 3 Months Ended |
Jun. 30, 2022 | |
SECURED LINE OF CREDIT | |
SECURED LINE OF CREDIT | NOTE 9. SECURED LINE OF CREDIT Long-term debt consists of the following: June 30, 2022 March 31, 2022 Secured line of credit bearing interest at LIBOR plus a spread $ 282,645,715 $ 275,645,715 Debt issuance costs, net (5,217,566) (5,789,546) $ 277,428,149 $ 269,856,169 Credit Facilities On December 19, 2014, Reservoir Media Management, Inc. (“ RMM RMM Credit Agreement Secured Loan Secured Line of Credit Credit Facilities Debt Refinancing “First Amendment” Senior Credit Facility The Senior Credit Facility has a scheduled maturity date of October 16, 2024. Borrowings under the Senior Credit Facility bear interest at a rate equal to either the sum of a base rate plus a margin of 1.25% or the sum of a LIBO rate plus a margin of 2.25%. RMM is also required to pay an unused fee in respect of unused commitments under the Senior Credit Facility, if any, at a rate of 0.25% per annum. Substantially all tangible and intangible assets of the Company, RHI, RMM and the other subsidiary guarantors are pledged as collateral to secure the obligations of RMM under the RMM Credit Agreement. The RMM Credit Agreement contains customary covenants limiting the ability of the Company, RHI, RMM and certain of its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, make investments, make cash dividends, redeem or repurchase capital stock, dispose of assets, enter into transactions with affiliates or enter into certain restrictive agreements. In addition, the Company, on a consolidated basis with its subsidiaries, must comply with financial covenants requiring the Company to maintain (i) a total leverage ratio (net of up to $20,000,000 of certain cash balances) of no greater than 7.50:1.00 as of the end of each fiscal quarter, (ii) a fixed charge coverage ratio of not less than 1.25:1.00 for each four fiscal quarter period, and (iii) a consolidated senior debt to library value ratio of 0.475, subject to certain adjustments. If RMM does not comply with the covenants in the RMM Credit Agreement, the lenders may, subject to customary cure rights, require the immediate payment of all amounts outstanding under the Senior Credit Facility. The Senior Credit Facility also includes an “accordion feature” that permits RMM to seek additional commitments in an amount not to exceed $50,000,000 that would increase the Senior Credit Facility. As of June 30, 2022, the Senior Credit Facility had a borrowing capacity of $350,000,000, with remaining borrowing availability of $67,354,285. Interest Rate Swaps At March 31, 2022, RMM had the following interest rate swaps outstanding, under which it pays a fixed rate and receives a floating interest payment from the counterparty based on LIBOR with reference to notional amounts adjusted to match the original scheduled principal repayments pursuant to the indenture agreement: Notional Amount at Pay June 30, Fixed Effective Date 2022 Rate Maturity March 10, 2022 $ 8,625,000 1.602 % September 2024 March 10, 2022 $ 87,979,412 1.492 % September 2024 December 31, 2021 $ 53,395,588 1.042 % September 2024 On March 10, 2022, two previous interest rate swaps expired with original notional amounts of $40,228,152 and $59,325,388. Through the expiration date of these previous interest rate swaps, RMM paid fixed rates of 2.812% and 2.972%, respectively, to the counterparty and received a floating interest payment from the counterparty based on LIBOR with reference to notional amounts adjusted to match the original scheduled principal repayments pursuant to the indenture agreement. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jun. 30, 2022 | |
INCOME TAXES | |
INCOME TAXES | NOTE 10. INCOME TAXES Income tax expense (benefit) for the three months ended June 30, 2022 and 2021 was $5,338 (24.1% effective tax rate) and $(527,145) (25.9% effective tax rate), respectively. The effective tax rates during these periods reflect the amount and mix of income from multiple tax jurisdictions. |
SUPPLEMENTARY CASH FLOW INFORMA
SUPPLEMENTARY CASH FLOW INFORMATION | 3 Months Ended |
Jun. 30, 2022 | |
SUPPLEMENTARY CASH FLOW INFORMATION | |
SUPPLEMENTARY CASH FLOW INFORMATION | NOTE 11. SUPPLEMENTARY CASH FLOW INFORMATION Interest paid and income taxes paid for the three months ended June 30, 2022 and 2021 were comprised of the following: 2022 2021 Interest paid $ 2,397,105 $ 2,214,072 Income taxes paid $ 10,000 $ — Non-cash investing and financing activities for the three months ended June 30, 2022 and 2021 were comprised of the following: 2022 2021 Acquired intangible assets included in other liabilities $ 315,455 $ — Reclassification of liability-classified awards to equity-classified awards $ 961,429 $ — |
AMOUNTS DUE TO RELATED PARTIES
AMOUNTS DUE TO RELATED PARTIES | 3 Months Ended |
Jun. 30, 2022 | |
AMOUNTS DUE TO RELATED PARTIES | |
AMOUNTS DUE TO RELATED PARTIES | NOTE 12. AMOUNTS DUE TO / (FROM) RELATED PARTIES The Company has various shared services agreements with a shareholder and other affiliated entities under the control of its shareholder. These agreements cover services such as IT support and re-billed services of staff who perform services across multiple entities. Amounts due to this shareholder and other affiliated entities totaled $0 as of June 30, 2022 and March 31, 2022. The acquisition of Tommy Boy was financed using cash on hand and borrowings from related parties (the “ Tommy Boy Related Party Notes Business Combination and PIPE Investment |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 3 Months Ended |
Jun. 30, 2022 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 13. SHAREHOLDERS’ EQUITY The condensed consolidated statements of shareholders’ equity reflect the reverse capitalization as of the Closing Date. Because RHI was deemed to be the accounting acquirer in the reverse capitalization with ROCC, all periods prior to the Closing Date reflect the balances and activity of RHI. The consolidated balances, share activity and per share amounts in these condensed consolidated statements of equity were retroactively adjusted, where applicable, using the Exchange Ratio. See Note 1, “ Description of Business Business Combination and PIPE Investment RHI Preferred Stock Prior to the Business Combination, RHI had 16,175,406 shares of RHI Preferred Stock outstanding. The RHI Preferred Stock was convertible into an equal number of shares of RHI Common Stock at the option of the preferred shareholder and was mandatorily converted into an equal number of shares of RHI Common Stock upon a qualified public offering of RHI Common Stock. Immediately prior to the effective time of the Business Combination, each share of RHI Preferred Stock that was issued and outstanding was automatically converted into a number of shares of RHI Common Stock pursuant to the RHI Preferred Stock Conversion. See Note 4, “ Business Combination and PIPE Investment While outstanding, the RHI Preferred Stock participated in dividends declared on common shares, if any, on the basis as if the shares of RHI Preferred Stock were converted into shares of RHI Common Stock. The Company did not declare any dividends subsequent to the issuance of RHI Preferred Stock through the RHI Preferred Stock Conversion. As of June 30, 2022 and March 31, 2022, the Company had no shares of RHI Preferred Stock outstanding. Warrants As of June 30, 2022, the Company’s outstanding warrants included 5,750,000 publicly-traded warrants (the “ Public Warrants Private Warrants Warrants The Company may redeem the outstanding Public Warrants in whole, but not in part, at a price of $0.01 per warrant upon a minimum of 30 days’ prior written notice of redemption, if and only if the last sale price of Common Stock equals or exceeds $18.00 per share for any 20-trading days within a 30-trading day period ending three business days before the Company sends the notice of redemption to the registered holders. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the warrants to do so on a cashless basis. In no event will the Company be required to net cash settle the warrant exercise. The Private Warrants are identical to the Public Warrants, except that the Private Warrants are exercisable for cash or on a cashless basis, at the holder’s option, and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. The Company evaluated the Warrants under ASC Topic 480, Distinguishing Liabilities from Equity ASC 480 Derivatives and Hedging ASC 815 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Jun. 30, 2022 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | NOTE 14. SHARE-BASED COMPENSATION 2021 Incentive Plan On July 28, 2021, in connection with the Business Combination, the Company adopted the Reservoir Media, Inc. 2021 Omnibus Incentive Plan (the “ 2021 Incentive Plan Previous RHI 2019 Incentive Plan As of the effective date of the 2021 Incentive Plan, no further stock awards have been or will be granted under the Previous RHI 2019 Incentive Plan, and the Previous RHI 2019 Incentive Plan is no longer in effect. Share-based compensation expense totaled $765,503 ($590,032, net of taxes) and $25,675 ($19,791, net of taxes) during the three months ended June 30, 2022 and 2021, respectively. Share-based compensation expense is classified as “Administration expenses” in the accompanying condensed consolidated statements of income. The increase in share-based compensation expense during the three months ended June 30, 2022 reflects the restricted stock units (“ RSUs During the three months ended June 30, 2022, the Company granted RSUs to satisfy previous obligations to issue a variable number of equity awards based on a fixed monetary amount. Prior to the issuance of these RSUs, the Company classified these awards as liabilities. Upon issuance of the RSU’s the awards became equity-classified as they no longer met the criteria to be liability-classified and a liability of $961,429 was reclassified from accounts payable and accrued liabilities to additional paid-in capital. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 3 Months Ended |
Jun. 30, 2022 | |
EARNINGS (LOSS) PER SHARE | |
EARNINGS (LOSS) PER SHARE | NOTE 15. EARNINGS (LOSS) PER SHARE The following table summarizes the basic and diluted earnings (loss) per common share calculation for the three months ended June 30, 2022 and 2021: Three Months Ended June 30, 2022 2021 Basic earnings (loss) per common share Net income (loss) attributable to Reservoir Media, Inc. $ 76,039 $ (1,452,998) Weighted average common shares outstanding - basic 64,223,531 28,539,299 Earnings (loss) per common share - basic $ — $ (0.05) Diluted earnings (loss) per common share Net income (loss) attributable to Reservoir Media, Inc. $ 76,039 $ (1,452,998) Weighted average common shares outstanding - basic 64,223,531 28,539,299 Weighted average effect of potentially dilutive securities: Effect of dilutive stock options and RSUs 558,208 — Weighted average common shares outstanding - diluted 64,781,739 28,539,299 Earnings (loss) per common share - diluted $ — $ (0.05) Because of their anti-dilutive effect, 5,887,500 shares of Common Stock equivalents comprised of warrants have been excluded from the diluted earnings per share calculation for the three months ended June 30, 2022. Prior to the RHI Preferred Stock Conversion in connection with the Business Combination, shares of the RHI Preferred Stock were considered participating securities. The RHI Preferred Shares are excluded from the loss per share calculation for the three months ended June 30, 2021 as they did not have an obligation to share or fund in the Company’s net losses and their inclusion would be anti-dilutive. Additionally, because of their anti-dilutive effect, 1,494,848 shares of Common Stock equivalents comprised of stock options have been excluded from the diluted earnings per share calculation for the three months ended June 30, 2021. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 3 Months Ended |
Jun. 30, 2022 | |
FINANCIAL INSTRUMENTS | |
FINANCIAL INSTRUMENTS | NOTE 16. FINANCIAL INSTRUMENTS The Company is exposed to the following risks related to its financial instruments: (a) Credit Risk Credit risk arises from the possibility that the Company’s debtors may be unable to fulfill their financial obligations. Revenues earned from publishing and distribution companies are concentrated in the music and entertainment industry. The Company monitors its exposure to credit risk on a regular basis. (b) Interest Rate Risk The Company is exposed to market risk from changes in interest rates on its secured loan. As described in Note 9, “ Secured Line of Credit, The fair value of the outstanding interest rate swaps was a $5,562,139 asset as of June 30, 2022 and a $3,991,802 asset as of March 31, 2022. Fair value is determined using Level 2 inputs, which are based on quoted prices and market observable data of similar instruments. The change in the unrealized fair value of the swaps during the three months ended June 30, 2022 of $1,570,337 was recorded as a gain on changes in fair value of derivative instruments. The change in the unrealized fair value of the swaps during the three months ended June 30, 2021 of $547,488 was recorded as a gain on changes in fair value of derivative instruments. (c) Foreign Exchange Risk The Company is exposed to foreign exchange risk in fluctuations of currency rates on its revenue from royalties, writers’ fees and its subsidiaries’ operations. (d) Financial Instruments Financial instruments not described elsewhere include cash, accounts receivable, accounts payable, accrued liabilities, secured loans payable and borrowing under its line of credit. The carrying values of these instruments as of June 30, 2022 do not differ materially from their respective fair values due to the immediate or short-term duration of these items or their bearing market-related rates of interest. The fair value of amounts due from and owed to related parties are impracticable to determine due to the related party nature of such amounts and the lack of a readily determinable secondary market. |
CONTINGENCIES AND COMMITMENTS
CONTINGENCIES AND COMMITMENTS | 3 Months Ended |
Jun. 30, 2022 | |
CONTINGENCIES AND COMMITMENTS | |
CONTINGENCIES AND COMMITMENTS | NOTE 17. CONTINGENCIES AND COMMITMENTS (a) Leases The Company leases its business premises under operating leases which have expiration dates between 2022 – 2027. The Company determines if an arrangement is or contains a lease at inception of the contract. Beginning April 1, 2022, the Company recognizes on the balance sheet a lease liability for its obligation to make lease payments arising from the lease and a corresponding ROU asset representing its right to use the underlying asset over the period of use based on the present value of lease payments over the lease term as of the lease commencement date in accordance with ASC 842. Certain leases contain fixed rent escalations and/or renewal options. None of the Company’s operating leases include variable lease payments. Subsequent amortization of the ROU asset and accretion of the lease liability for an operating lease is recognized as a single lease cost, on a straight-line basis, over the lease term. Reductions of the ROU asset and the change in the lease liability are included in changes in Other assets and liabilities in the Consolidated Statement of Cash Flows. During the three months ended June 30, 2022, the Company extended one operating lease by two months. The resulting increase to the lease liability totaled approximately $74,000, with a corresponding increase to the ROU asset. In April 2022, the Company entered into an agreement for its new headquarter office facility consisting of 12,470 square feet of leased office space at 200 Varick Street, Suite 801A, New York, NY (the “ New HQ Lease (b) Litigation The Company is subject to claims and contingencies in the normal course of business. To the extent the Company cannot predict the outcome of the claims and contingencies or estimate the amount of any loss that may result, no provision for any contingent liabilities has been made in the consolidated financial statements. The Company believes that losses resulting from these matters, if any, would not have a material adverse effect on the financial position, results of operations or cash flows of the Company. All such matters which the Company concludes are probable to result in a loss and for which management can reasonably estimate the amount of such loss have been accrued for within these condensed consolidated financial statements. |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Jun. 30, 2022 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | NOTE 18. SEGMENT REPORTING The Company’s business is organized in two reportable segments: Music Publishing and Recorded Music. The Company identified its Chief Executive Officer as its Chief Operating Decision Maker (“ CODM OIBDA The accounting policies of the Company’s business segments are consistent with the Company’s policies for the consolidated financial statements. The Company does not have sales between segments. The following tables present total revenue and reconciliation of OIBDA to operating income by segment for the three months ended June 30, 2022 and 2021: Three Months Ended June 30, 2022 Music Recorded Publishing Music Other Consolidated Total revenue $ 16,446,707 $ 7,570,711 $ 261,352 $ 24,278,770 Reconciliation of OIBDA to operating income (loss): Operating income (loss) (261,308) 1,581,310 524 1,320,526 Amortization and depreciation 3,954,370 1,384,481 22,652 5,361,503 OIBDA $ 3,693,062 $ 2,965,791 $ 23,176 $ 6,682,029 Three Months Ended June 30, 2021 Music Recorded Publishing Music Other Consolidated Total revenue $ 12,203,773 $ 4,207,795 $ 221,063 $ 16,632,631 Reconciliation of OIBDA to operating income (loss): Operating income (loss) (a) 229,167 (73,301) 59,825 215,691 Amortization and depreciation 3,169,209 865,458 25,056 4,059,723 OIBDA $ 3,398,376 $ 792,157 $ 84,881 $ 4,275,414 (a) |
CORRECTION OF PRIOR PERIOD ERRO
CORRECTION OF PRIOR PERIOD ERRORS | 3 Months Ended |
Jun. 30, 2022 | |
CORRECTION OF PRIOR PERIOD ERRORS | |
CORRECTION OF PRIOR PERIOD ERRORS | NOTE 19. CORRECTION OF PRIOR PERIOD ERRORS As previously disclosed in Note 19 to the Company’s consolidated financial statements as of and for the fiscal year ended March 31, 2022, the Company identified prior period accounting errors that the Company has concluded are not material to the Company’s previously reported consolidated financial statements and unaudited interim condensed consolidated financial statements. Based on management’s evaluation of the accounting errors in consideration of the SEC Staff’s Accounting Bulletins Nos. 99 (“ SAB 99 SAB 108 previously reported financial statements The following is a description of the accounting errors and their impact on the Company’s previously reported financial statements: The Company identified certain accounting errors that originated in the fourth quarter of fiscal year 2020 related to the recognition of royalty revenue associated with royalties generated from the pre-acquisition usage of intellectual property rights that the Company acquired in certain of its music catalog acquisitions for which the Company was entitled to collect pre-acquisition royalties from the sellers for a specified period prior to the closing date of these acquisitions. The Company’s historical accounting practice with respect to pre-acquisition royalties was to recognize revenue upon closing of the acquisitions. Upon further review, the Company concluded that the pre-acquisition royalties should have been accounted for as reduction of the purchase price of the acquired music catalogs, as prescribed by ASC 805-50, Business Combinations – Related Issues ASC 805-50 Revenue from Contracts with Customers ASC 606 As part of its review, the Company further concluded that certain royalty revenue generated from pre-acquisition usage that remained uncollected at closing, as well as the related royalties due to certain artists or songwriters associated with each of the acquired music catalogs, should have been recognized as accounts receivable and royalties payable, respectively, on the closing date of the acquired music catalog based on the Company’s best estimate of the uncollected royalties due to the Company and payables due to the artists or songwriters on the closing date. The Company’s historical accounting practice associated with these uncollected royalties and royalties payable was to recognize the uncollected royalties as revenue under ASC 606 as they were collected after the closing date, and to recognize cost of revenue as the royalties due to the artists or songwriters when the related royalty revenue was collected. The Company also concluded that the acquired accounts receivable and royalties payable assumed on the date of closing should have been included in the purchase price allocation of the Company’s acquired music catalogs, as prescribed by ASC 805-50. The financial tables below present the impact of correcting the accounting errors on the Company’s previously reported financial statements. The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of income for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Revenues $ 16,718,150 $ (85,519) $ 16,632,631 Amortization and depreciation 4,079,245 (19,522) 4,059,723 Total costs and expenses 16,436,462 (19,522) 16,416,940 Operating income 281,688 (65,997) 215,691 Loss before income taxes (1,968,129) (65,997) (2,034,126) Income tax benefit (510,646) (16,499) (527,145) Net loss (1,457,483) (49,498) (1,506,981) Net loss attributable to Reservoir Media, Inc. (1,403,500) (49,498) (1,452,998) Loss per common share - basic $ (0.05) $ — $ (0.05) Loss per common share - diluted $ (0.05) $ — $ (0.05) The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of comprehensive income (loss) for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Net loss $ (1,457,483) $ (49,498) $ (1,506,981) Total comprehensive loss (1,242,341) (49,498) (1,291,839) Total comprehensive loss attributable to Reservoir Holdings, Inc. (1,188,358) (49,498) (1,237,856) The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated balance sheet and consolidated statement of changes in shareholders’ equity as of June 30, 2021: June 30, 2021 As Reported Adjustment Revised Intangible assets, net $ 500,591,041 $ (2,154,844) $ 498,436,197 Total assets 580,983,613 (2,154,844) 578,828,769 Income taxes payable 533,937 (6,323) 527,614 Deferred income taxes 19,772,056 (484,419) 19,287,637 Total liabilities 386,215,074 (490,742) 385,724,332 Accumulated deficit (652,004) (1,664,102) (2,316,106) Total Reservoir Media, Inc, shareholders’ equity 193,816,825 (1,664,102) 192,152,723 Total shareholders’ equity 194,768,539 (1,664,102) 193,104,437 Total liabilities and shareholders’ equity 580,983,613 (2,154,844) 578,828,769 The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of cash flows for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Net loss $ (1,457,483) $ (49,498) $ (1,506,981) Amortization of intangible assets 4,047,966 (19,522) 4,028,444 Deferred income taxes 36,519 (16,499) 20,020 Net cash provided by operating activities 3,827,380 (85,519) 3,741,861 Purchases of music catalogs (112,264,047) 85,519 (112,178,528) Net cash used for investing activities (112,785,355) 85,519 (112,699,836) |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 3 Months Ended |
Jun. 30, 2022 | |
SUBSEQUENT EVENT. | |
SUBSEQUENT EVENT | NOTE 20. SUBSEQUENT EVENT In July 2022, the U.S. Copyright Royalty Board (“ CRB Initial Ruling For much of the period between 2018 and 2022, most digital service providers (“ DSPs |
RECENT ACCOUNTING PRONOUNCEME_2
RECENT ACCOUNTING PRONOUNCEMENTS (Policies) | 3 Months Ended |
Jun. 30, 2022 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
Recent Accounting Pronouncements | Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-03, “ Financial Instruments–Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ASU 2016-03 In April 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform (Topic 848) ASU 2020-04 Accounting Standards Recently Adopted In February 2016, the FASB issued Accounting Standards Update (“ ASU Leases (Topic 842) ASU 2016-02 Leases ASC 842 ROU effective date The new guidance also provides several practical expedients and policies that companies may elect. The Company elected the package of practical expedients under which it did not reassess the classification of its existing leases, reevaluate whether any expired or existing contracts are or contain leases or reassess initial direct costs under the new guidance. Rather, the Company retained the conclusions reached for these items under ASC Topic 840, Leases Upon its transition to the new guidance, the Company recognized approximately $2.1 million of operating lease liabilities and corresponding ROU assets. As the rates implicit in the Company’s leases are not readily determinable, the Company used its incremental borrowing rate based on the information available at the effective date to determine the present value of lease payments. This rate is based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments. The adoption of this new guidance will not have a material impact on the amount or timing of the Company’s cash flows or liquidity. In December 2019, the FASB issued ASU 2019-12, “ Simplifying the Accounting for Income Taxes ASU 2019-12 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
REVENUE RECOGNITION | |
Schedule of revenue | Three Months Ended June 30, 2022 2021 Revenue by Type Digital $ 8,463,870 $ 6,610,811 Performance 3,536,424 2,649,213 Synchronization 3,299,346 1,941,916 Mechanical 514,468 408,967 Other 632,599 592,866 Total Music Publishing 16,446,707 12,203,773 Digital 4,563,542 2,811,841 Physical 1,297,178 966,637 Neighboring rights 685,349 327,275 Synchronization 1,024,642 102,042 Total Recorded Music 7,570,711 4,207,795 Other revenue 261,352 221,063 Total revenue $ 24,278,770 $ 16,632,631 Three Months Ended June 30, 2022 2021 Revenue by Geographical Location United States Music Publishing $ 9,843,294 $ 6,823,175 United States Recorded Music 3,802,836 1,570,937 United States other revenue 261,352 221,063 Total United States 13,907,482 8,615,175 International Music Publishing 6,603,413 5,380,598 International Recorded Music 3,767,875 2,636,858 Total International 10,371,288 8,017,456 Total revenue $ 24,278,770 $ 16,632,631 |
Schedule of change in deferred revenue | June 30 2022 June 30 2021 Balance at beginning of period $ 1,103,664 $ 1,337,987 Cash received during period 156,140 898,661 Revenue recognized during period (534,366) (392,605) Balance at end of period $ 725,438 $ 1,844,043 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
INTANGIBLE ASSETS | |
Schedule of intangible assets | June 30, 2022 March 31, 2022 Intangible assets subject to amortization: Publishing and recorded music catalogs $ 652,123,466 $ 654,284,671 Artist management contracts 876,509 947,723 Gross intangible assets 652,999,975 655,232,394 Accumulated amortization (88,583,132) (83,848,539) Intangible assets, net $ 564,416,843 $ 571,383,855 |
ROYALTY ADVANCES (Tables)
ROYALTY ADVANCES (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
ROYALTY ADVANCES | |
Schedule of royalty advances | June 30, 2022 June 30, 2021 Balance at beginning of period $ 57,012,754 $ 41,582,080 Additions 10,227,209 6,258,299 Recoupments (3,307,724) (2,389,679) Balance at end of period $ 63,932,239 $ 45,450,700 |
SECURED LINE OF CREDIT (Tables)
SECURED LINE OF CREDIT (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
SECURED LINE OF CREDIT | |
Schedule of long-term debt | June 30, 2022 March 31, 2022 Secured line of credit bearing interest at LIBOR plus a spread $ 282,645,715 $ 275,645,715 Debt issuance costs, net (5,217,566) (5,789,546) $ 277,428,149 $ 269,856,169 |
Schedule of interest rate swaps | Notional Amount at Pay June 30, Fixed Effective Date 2022 Rate Maturity March 10, 2022 $ 8,625,000 1.602 % September 2024 March 10, 2022 $ 87,979,412 1.492 % September 2024 December 31, 2021 $ 53,395,588 1.042 % September 2024 |
SUPPLEMENTARY CASH FLOW INFOR_2
SUPPLEMENTARY CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
SUPPLEMENTARY CASH FLOW INFORMATION | |
Summary of interest paid and income taxes paid | 2022 2021 Interest paid $ 2,397,105 $ 2,214,072 Income taxes paid $ 10,000 $ — |
Schedule of non-cash investing and financing activities | 2022 2021 Acquired intangible assets included in other liabilities $ 315,455 $ — Reclassification of liability-classified awards to equity-classified awards $ 961,429 $ — |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
EARNINGS (LOSS) PER SHARE | |
Summary of basic and diluted earnings per common share calculation | Three Months Ended June 30, 2022 2021 Basic earnings (loss) per common share Net income (loss) attributable to Reservoir Media, Inc. $ 76,039 $ (1,452,998) Weighted average common shares outstanding - basic 64,223,531 28,539,299 Earnings (loss) per common share - basic $ — $ (0.05) Diluted earnings (loss) per common share Net income (loss) attributable to Reservoir Media, Inc. $ 76,039 $ (1,452,998) Weighted average common shares outstanding - basic 64,223,531 28,539,299 Weighted average effect of potentially dilutive securities: Effect of dilutive stock options and RSUs 558,208 — Weighted average common shares outstanding - diluted 64,781,739 28,539,299 Earnings (loss) per common share - diluted $ — $ (0.05) |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
SEGMENT REPORTING | |
Summary of total revenue and reconciliation of OIBDA to operating income by segment | Three Months Ended June 30, 2022 Music Recorded Publishing Music Other Consolidated Total revenue $ 16,446,707 $ 7,570,711 $ 261,352 $ 24,278,770 Reconciliation of OIBDA to operating income (loss): Operating income (loss) (261,308) 1,581,310 524 1,320,526 Amortization and depreciation 3,954,370 1,384,481 22,652 5,361,503 OIBDA $ 3,693,062 $ 2,965,791 $ 23,176 $ 6,682,029 Three Months Ended June 30, 2021 Music Recorded Publishing Music Other Consolidated Total revenue $ 12,203,773 $ 4,207,795 $ 221,063 $ 16,632,631 Reconciliation of OIBDA to operating income (loss): Operating income (loss) (a) 229,167 (73,301) 59,825 215,691 Amortization and depreciation 3,169,209 865,458 25,056 4,059,723 OIBDA $ 3,398,376 $ 792,157 $ 84,881 $ 4,275,414 (a) |
CORRECTION OF PRIOR PERIOD ER_2
CORRECTION OF PRIOR PERIOD ERRORS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
CORRECTION OF PRIOR PERIOD ERRORS | |
Schedule of correction of prior period errors | The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of income for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Revenues $ 16,718,150 $ (85,519) $ 16,632,631 Amortization and depreciation 4,079,245 (19,522) 4,059,723 Total costs and expenses 16,436,462 (19,522) 16,416,940 Operating income 281,688 (65,997) 215,691 Loss before income taxes (1,968,129) (65,997) (2,034,126) Income tax benefit (510,646) (16,499) (527,145) Net loss (1,457,483) (49,498) (1,506,981) Net loss attributable to Reservoir Media, Inc. (1,403,500) (49,498) (1,452,998) Loss per common share - basic $ (0.05) $ — $ (0.05) Loss per common share - diluted $ (0.05) $ — $ (0.05) The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of comprehensive income (loss) for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Net loss $ (1,457,483) $ (49,498) $ (1,506,981) Total comprehensive loss (1,242,341) (49,498) (1,291,839) Total comprehensive loss attributable to Reservoir Holdings, Inc. (1,188,358) (49,498) (1,237,856) The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated balance sheet and consolidated statement of changes in shareholders’ equity as of June 30, 2021: June 30, 2021 As Reported Adjustment Revised Intangible assets, net $ 500,591,041 $ (2,154,844) $ 498,436,197 Total assets 580,983,613 (2,154,844) 578,828,769 Income taxes payable 533,937 (6,323) 527,614 Deferred income taxes 19,772,056 (484,419) 19,287,637 Total liabilities 386,215,074 (490,742) 385,724,332 Accumulated deficit (652,004) (1,664,102) (2,316,106) Total Reservoir Media, Inc, shareholders’ equity 193,816,825 (1,664,102) 192,152,723 Total shareholders’ equity 194,768,539 (1,664,102) 193,104,437 Total liabilities and shareholders’ equity 580,983,613 (2,154,844) 578,828,769 The following table presents the impact of correcting the accounting errors on the Company’s previously reported unaudited condensed consolidated statement of cash flows for the three months ended June 30, 2021: Three Months Ended June 30, 2021 As Reported Adjustment Revised Net loss $ (1,457,483) $ (49,498) $ (1,506,981) Amortization of intangible assets 4,047,966 (19,522) 4,028,444 Deferred income taxes 36,519 (16,499) 20,020 Net cash provided by operating activities 3,827,380 (85,519) 3,741,861 Purchases of music catalogs (112,264,047) 85,519 (112,178,528) Net cash used for investing activities (112,785,355) 85,519 (112,699,836) |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details) | 3 Months Ended | ||
Jun. 30, 2022 item segment $ / shares | Mar. 31, 2022 $ / shares | Jul. 28, 2021 $ / shares | |
Subsidiary, Sale of Stock [Line Items] | |||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Number of Operating Segments | segment | 2 | ||
Music Publishing | |||
Subsidiary, Sale of Stock [Line Items] | |||
Minimum ownership or control rights | 140,000 | ||
Recorded Music | |||
Subsidiary, Sale of Stock [Line Items] | |||
Minimum ownership or control rights | 36,000 |
RECENT ACCOUNTING PRONOUNCEME_3
RECENT ACCOUNTING PRONOUNCEMENTS (Details) $ in Millions | Jun. 30, 2022 USD ($) |
RECENT ACCOUNTING PRONOUNCEMENTS | |
Operating Lease Liabilities | $ 2.1 |
BUSINESS COMBINATION AND PIPE_2
BUSINESS COMBINATION AND PIPE INVESTMENT (Details) | 3 Months Ended | ||
Jun. 30, 2022 USD ($) $ / shares shares | Mar. 31, 2022 $ / shares shares | Jul. 28, 2021 $ / shares | |
Business Acquisition [Line Items] | |||
Preferred stock, shares, par value | $ 0.0001 | $ 0.0001 | |
Common shares, par value, (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Fees in connection with the closing of the Business combination and PIPE Investment | $ | $ 20,900,000 | ||
Repayment of Related Party Notes | $ | 81,300,000 | ||
Repayment of secured loan | $ | $ 18,250,000 | ||
Common stock, shares authorized | shares | 750,000,000 | 750,000,000 | |
Preferred stock, shares, authorized | shares | 75,000,000 | 75,000,000 | |
RHI Preferred Stock | |||
Business Acquisition [Line Items] | |||
Preferred stock, shares, par value | $ 0.00001 | ||
RHI Common Stock | |||
Business Acquisition [Line Items] | |||
Common shares, par value, (per share) | 0.00001 | ||
Common Stock | |||
Business Acquisition [Line Items] | |||
Common shares, par value, (per share) | $ 0.0001 | ||
Exchange ratio | 196.06562028646 | ||
PIPE investors | |||
Business Acquisition [Line Items] | |||
Number of shares issued | shares | 15,000,000 | ||
Purchase price | $ 10 | ||
Aggregate purchase price | $ | $ 150,000,000 | ||
Repayment of secured lines of credit | $ | $ 36,750,000 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue recognized from performance obligations satisfied in previous period | $ 1,038,536 | $ 82,148 |
Revenues | 24,278,770 | 16,632,631 |
Adjustment | ||
Revenues | (85,519) | |
United States | ||
Revenues | 13,907,482 | 8,615,175 |
International | ||
Revenues | 10,371,288 | 8,017,456 |
Music Publishing | ||
Revenues | 16,446,707 | 12,203,773 |
Music Publishing | United States | ||
Revenues | 9,843,294 | 6,823,175 |
Music Publishing | International | ||
Revenues | 6,603,413 | 5,380,598 |
Recorded Music | ||
Revenues | 7,570,711 | 4,207,795 |
Recorded Music | United States | ||
Revenues | 3,802,836 | 1,570,937 |
Recorded Music | International | ||
Revenues | 3,767,875 | 2,636,858 |
Other | ||
Revenues | 261,352 | 221,063 |
Other | United States | ||
Revenues | 261,352 | 221,063 |
Performance | Music Publishing | ||
Revenues | 3,536,424 | 2,649,213 |
Digital | Music Publishing | ||
Revenues | 8,463,870 | 6,610,811 |
Digital | Recorded Music | ||
Revenues | 4,563,542 | 2,811,841 |
Mechanical | Music Publishing | ||
Revenues | 514,468 | 408,967 |
Physical | Recorded Music | ||
Revenues | 1,297,178 | 966,637 |
Synchronization | Music Publishing | ||
Revenues | 3,299,346 | 1,941,916 |
Synchronization | Recorded Music | ||
Revenues | 1,024,642 | 102,042 |
Other. | Music Publishing | ||
Revenues | 632,599 | 592,866 |
Neighboring rights | Recorded Music | ||
Revenues | $ 685,349 | $ 327,275 |
REVENUE RECOGNITION - Change in
REVENUE RECOGNITION - Change in Deferred Revenue (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
REVENUE RECOGNITION | ||
Balance at beginning of period | $ 1,103,664 | $ 1,337,987 |
Cash received during period | 156,140 | 898,661 |
Revenue recognized during period | (534,366) | (392,605) |
Balance at end of period | $ 725,438 | $ 1,844,043 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) | 3 Months Ended | ||
Jun. 02, 2021 USD ($) item | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | |
Asset Acquisition [Line Items] | |||
Number of Members of Board, Holding Membership in Acquired Company's Board | item | 2 | ||
Publishing and recorded music catalogs | |||
Asset Acquisition [Line Items] | |||
Total consideration transferred | $ 3,391,376 | $ 111,070,099 | |
Tommy Boy | |||
Asset Acquisition [Line Items] | |||
Total consideration transferred | $ 100,000,000 | ||
Tommy Boy | Recorded music catalog | |||
Asset Acquisition [Line Items] | |||
Weighted average useful life | 30 years |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross intangible assets | $ 652,999,975 | $ 655,232,394 | |
Accumulated amortization | (88,583,132) | (83,848,539) | |
Intangible assets, net | 564,416,843 | $ 498,436,197 | 571,383,855 |
Amortization expense | 5,315,265 | $ 4,028,444 | |
Publishing and recorded music catalogs | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross intangible assets | 652,123,466 | 654,284,671 | |
Artist management contracts | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross intangible assets | $ 876,509 | $ 947,723 |
ROYALTY ADVANCES (Details)
ROYALTY ADVANCES (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
ROYALTY ADVANCES | ||
Balance at beginning of period | $ 57,012,754 | $ 41,582,080 |
Additions | 10,227,209 | 6,258,299 |
Recoupments | (3,307,724) | (2,389,679) |
Balance at end of period | $ 63,932,239 | $ 45,450,700 |
SECURED LINE OF CREDIT - Schedu
SECURED LINE OF CREDIT - Schedule of long-term debt (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Long-term Debt, by Current and Noncurrent [Abstract] | ||
Debt issuance costs, net | $ (5,217,566) | $ (5,789,546) |
Long-term portion | 277,428,149 | 269,856,169 |
Secured loan | ||
Long-term Debt, by Current and Noncurrent [Abstract] | ||
Debt, bearing interest at LIBOR plus a spread | $ 282,645,715 | $ 275,645,715 |
SECURED LINE OF CREDIT - Credit
SECURED LINE OF CREDIT - Credit Facilities (Details) | 3 Months Ended | ||
Jun. 30, 2022 USD ($) | Dec. 07, 2021 USD ($) | Jun. 30, 2021 USD ($) | |
Debt Instrument [Line Items] | |||
Unused fee (in percent) | 0.25% | ||
Total Leverage of cash balance | $ 20,000,000 | ||
New Senior Credit Facility | |||
Debt Instrument [Line Items] | |||
Aggregate amount | $ 350,000,000 | ||
Consolidated senior debt to library value ratio | 0.475 | ||
Additional commitments | $ 50,000,000 | ||
Borrowing capacity | $ 350,000,000 | ||
Remaining borrowing availability | $ 67,354,285 | ||
RMM credit agreement | |||
Debt Instrument [Line Items] | |||
Aggregate amount | $ 248,750,000 | ||
Base rate | |||
Debt Instrument [Line Items] | |||
Margin (in percent) | 1.25% | ||
LIBOR | |||
Debt Instrument [Line Items] | |||
Margin (in percent) | 2.25% | ||
Maximum | New Senior Credit Facility | |||
Debt Instrument [Line Items] | |||
Total leverage ratio | 7.50 | ||
Minimum | New Senior Credit Facility | |||
Debt Instrument [Line Items] | |||
Fixed charge coverage ratio | 1.25 |
SECURED LINE OF CREDIT - Intere
SECURED LINE OF CREDIT - Interest Rate Swaps (Details) - USD ($) | Jun. 30, 2022 | Mar. 10, 2022 | Mar. 10, 2021 |
Interest rate swaps | |||
Debt Instrument [Line Items] | |||
Notional amount | $ 8,625,000 | ||
Fixed rate (in percent) | 1.602% | ||
Interest rate swap one | |||
Debt Instrument [Line Items] | |||
Notional amount | $ 87,979,412 | $ 40,228,152 | |
Fixed rate (in percent) | 1.492% | 2.812% | |
Interest rate swap two | |||
Debt Instrument [Line Items] | |||
Notional amount | $ 53,395,588 | $ 59,325,388 | |
Fixed rate (in percent) | 1.042% | 2.972% |
INCOME TAXES - Domestic and for
INCOME TAXES - Domestic and foreign income before income taxes (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
INCOME TAXES | ||
Income before income taxes | $ 22,159 | $ (2,034,126) |
INCOME TAXES - Provision for in
INCOME TAXES - Provision for income taxes (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Deferred income taxes: | ||
Total deferred | $ 20,020 | |
Income tax expense | $ 5,338 | $ (527,145) |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of the statutory tax rate to the effective rate (Details) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
INCOME TAXES | ||
Effective income tax rate | 24.10% | 25.90% |
INCOME TAXES - Company's deferr
INCOME TAXES - Company's deferred income tax liability (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 |
Deferred tax liabilities: | |||
Net deferred tax liabilities | $ (24,040,179) | $ (24,884,170) | $ (19,287,637) |
SUPPLEMENTARY CASH FLOW INFOR_3
SUPPLEMENTARY CASH FLOW INFORMATION (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
SUPPLEMENTARY CASH FLOW INFORMATION | ||
Interest paid | $ 2,397,105 | $ 2,214,072 |
Income taxes paid | 10,000 | |
Acquired intangible assets included in other liabilities | 315,455 | |
Reclassification of liability-classified awards to equity-classified awards | $ 961,429 |
AMOUNTS DUE TO RELATED PARTIES
AMOUNTS DUE TO RELATED PARTIES (Details) - USD ($) | Dec. 21, 2021 | Jun. 30, 2022 |
Related Party Transaction [Line Items] | ||
Amounts due to this shareholder and other affiliated entities | $ 0 | |
Tommy Boy | ||
Related Party Transaction [Line Items] | ||
Percentage of interest rate per year | 4.66% |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - shares | Jun. 30, 2022 | Mar. 31, 2022 | Jul. 28, 2021 |
Class of Stock [Line Items] | |||
Preferred stock, shares, outstanding | 0 | 0 | |
RHI Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred stock, shares, outstanding | 0 | 0 | 16,175,406 |
SHAREHOLDERS' EQUITY - Warrants
SHAREHOLDERS' EQUITY - Warrants (Details) - Common Stock Warrants | 3 Months Ended | |
Dec. 15, 2020 shares | Jun. 30, 2022 D $ / shares shares | |
Class of Warrant or Right [Line Items] | ||
Number of warrants outstanding | shares | 5,750,000 | |
Number of warrants sold | shares | 137,500 | |
Number of shares issuable per warrant | shares | 1 | |
Exercise price of warrants | $ / shares | $ 11.50 | |
Warrants expiration term (in years) | 5 years | |
Redemption price per public warrant (in dollars per share) | $ / shares | $ 0.01 | |
Minimum threshold written notice period for redemption of public warrants | 30 days | |
Stock price trigger for redemption of public warrants (in dollars per share) | $ / shares | $ 18 | |
Threshold trading days for redemption of public warrants | 20 days | |
Threshold consecutive trading days for redemption of public warrants | 30 days | |
Threshold number of business days before sending notice of redemption to warrant holders | D | 3 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) | 3 Months Ended | ||
Jul. 28, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 765,503 | $ 25,675 | |
Share-based compensation expense net of taxes | 590,032 | $ 19,791 | |
Restricted stock units (RSUs) | Additional paid-in capital | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Accounts Payable to Accrued Liabilities to Additional Paid-in Capital | $ 961,429 | ||
2021 Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares to purchase the Common Stock | 1,494,848 |
EARNINGS PER SHARE - Summary of
EARNINGS PER SHARE - Summary of Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Basic earnings (loss) per common share | ||
Net income attributable to Reservoir Media, Inc. | $ 76,039 | $ (1,452,998) |
Weighted average common shares outstanding - basic | 64,223,531 | 28,539,299 |
Loss per common share - basic | $ 0 | $ (0.05) |
Diluted earnings (loss) per common share | ||
Net income (loss) attributable to Reservoir Media, Inc. | $ 76,039 | $ (1,452,998) |
Net income (loss) attributable to Reservoir Media, Inc. | $ 76,039 | $ (1,452,998) |
Weighted average common shares outstanding - basic | 64,223,531 | 28,539,299 |
Weighted average effect of potentially dilutive securities: | ||
Effect of dilutive stock options and RSUs | 558,208 | |
Weighted average common shares outstanding - diluted | 64,781,739 | 28,539,299 |
Loss per common share - diluted | $ 0 | $ (0.05) |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Details) - shares | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive effect of common shares | 5,887,500 | |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive effect of common shares | 1,494,848 |
FINANCIAL INSTRUMENTS - Additio
FINANCIAL INSTRUMENTS - Additional Information (Details) - Level 2 - Interest rate swaps - USD ($) | 3 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Fair value of swap liability | $ 5,562,139 | $ 3,991,802 | |
Gain on changes in fair value of derivative instruments | $ 1,570,337 | $ 547,488 |
CONTINGENCIES AND COMMITMENTS -
CONTINGENCIES AND COMMITMENTS - Additional Information (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Apr. 30, 2022 | |
CONTINGENCIES AND COMMITMENTS | ||
Increase in Operating Lease Liability | $ 74,000 | |
Other Commitment | $ 8,400,000 | |
Provision made | $ 0 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) | 3 Months Ended |
Jun. 30, 2022 segment | |
SEGMENT REPORTING | |
Number of reportable segments | 2 |
SEGMENT REPORTING - Total reven
SEGMENT REPORTING - Total revenue (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total revenue | $ 24,278,770 | $ 16,632,631 |
Reconciliation of OIBDA to operating income (loss): | ||
Operating income | 1,320,526 | 215,691 |
Amortization and depreciation | 5,361,503 | 4,059,723 |
OIBDA | 6,682,029 | 4,275,414 |
Music Publishing | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total revenue | 16,446,707 | 12,203,773 |
Reconciliation of OIBDA to operating income (loss): | ||
Operating income | (261,308) | 229,167 |
Amortization and depreciation | 3,954,370 | 3,169,209 |
OIBDA | 3,693,062 | 3,398,376 |
Recorded Music | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total revenue | 7,570,711 | 4,207,795 |
Reconciliation of OIBDA to operating income (loss): | ||
Operating income | 1,581,310 | (73,301) |
Amortization and depreciation | 1,384,481 | 865,458 |
OIBDA | 2,965,791 | 792,157 |
Other | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Total revenue | 261,352 | 221,063 |
Reconciliation of OIBDA to operating income (loss): | ||
Operating income | 524 | 59,825 |
Amortization and depreciation | 22,652 | 25,056 |
OIBDA | $ 23,176 | $ 84,881 |
CORRECTION OF PRIOR PERIOD ER_3
CORRECTION OF PRIOR PERIOD ERRORS (Details) - USD ($) | 3 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
Revenues | $ 24,278,770 | $ 16,632,631 | ||
Cost of revenue | 9,975,131 | 7,692,387 | ||
Amortization and depreciation | 5,361,503 | 4,059,723 | ||
Total costs and expenses | 22,958,244 | 16,416,940 | ||
Operating income | 1,320,526 | 215,691 | ||
Loss before income taxes | 22,159 | (2,034,126) | ||
Income tax benefit | 5,338 | (527,145) | ||
Net income (loss) | 16,821 | (1,506,981) | ||
Net loss attributable to Reservoir Media, Inc. | $ 76,039 | $ (1,452,998) | ||
Loss per common share - basic | $ 0 | $ (0.05) | ||
Loss per common share - diluted | $ 0 | $ (0.05) | ||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Net income (loss) | $ 16,821 | $ (1,506,981) | ||
Total comprehensive income | (1,291,839) | |||
Total comprehensive income attributable to Reservoir Media, Inc. | (4,935,524) | (1,237,856) | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
Intangible assets, net | 564,416,843 | 498,436,197 | $ 571,383,855 | |
Total assets | 683,319,446 | 578,828,769 | 684,270,090 | |
Income taxes payable | 116,324 | 527,614 | 77,496 | |
Deferred income taxes | 24,040,179 | 19,287,637 | 24,884,170 | |
Total liabilities | 340,016,832 | 385,724,332 | 336,817,766 | |
Accumulated Deficit | 12,289,558 | (2,316,106) | 12,213,519 | |
Total Reservoir Media, Inc. shareholders' equity | 342,304,365 | 192,152,723 | 346,394,857 | |
Total shareholders' equity | 343,302,614 | 193,104,437 | 347,452,324 | $ 194,370,601 |
Total liabilities and shareholders' equity | 683,319,446 | 578,828,769 | $ 684,270,090 | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Net income (loss) | 16,821 | (1,506,981) | ||
Amortization of intangible assets | 5,315,265 | 4,028,444 | ||
Accounts payable and accrued expenses | 4,339,141 | 5,891,735 | ||
Income tax payable | 38,828 | 442 | ||
Deferred income taxes | 20,020 | |||
Net cash provided by operating activities | 1,802,957 | 3,741,861 | ||
Purchases of music catalogs | (12,708,782) | (112,178,528) | ||
Net cash used for investing activities | $ (12,772,573) | (112,699,836) | ||
As reported | ||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
Revenues | 16,718,150 | |||
Amortization and depreciation | 4,079,245 | |||
Total costs and expenses | 16,436,462 | |||
Operating income | 281,688 | |||
Loss before income taxes | (1,968,129) | |||
Income tax benefit | (510,646) | |||
Net income (loss) | (1,457,483) | |||
Net loss attributable to Reservoir Media, Inc. | $ (1,403,500) | |||
Loss per common share - basic | $ (0.05) | |||
Loss per common share - diluted | $ (0.05) | |||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Net income (loss) | $ (1,457,483) | |||
Total comprehensive income | (1,242,341) | |||
Total comprehensive income attributable to Reservoir Media, Inc. | (1,188,358) | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
Intangible assets, net | 500,591,041 | |||
Total assets | 580,983,613 | |||
Income taxes payable | 533,937 | |||
Deferred income taxes | 19,772,056 | |||
Total liabilities | 386,215,074 | |||
Accumulated Deficit | (652,004) | |||
Total Reservoir Media, Inc. shareholders' equity | 193,816,825 | |||
Total shareholders' equity | 194,768,539 | |||
Total liabilities and shareholders' equity | 580,983,613 | |||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Net income (loss) | (1,457,483) | |||
Amortization of intangible assets | 4,047,966 | |||
Deferred income taxes | 36,519 | |||
Net cash provided by operating activities | 3,827,380 | |||
Purchases of music catalogs | (112,264,047) | |||
Net cash used for investing activities | (112,785,355) | |||
Adjustment | ||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
Revenues | (85,519) | |||
Amortization and depreciation | (19,522) | |||
Total costs and expenses | (19,522) | |||
Operating income | (65,997) | |||
Loss before income taxes | (65,997) | |||
Income tax benefit | (16,499) | |||
Net income (loss) | (49,498) | |||
Net loss attributable to Reservoir Media, Inc. | (49,498) | |||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Net income (loss) | (49,498) | |||
Total comprehensive income | (49,498) | |||
Total comprehensive income attributable to Reservoir Media, Inc. | (49,498) | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
Intangible assets, net | (2,154,844) | |||
Total assets | (2,154,844) | |||
Income taxes payable | (6,323) | |||
Deferred income taxes | (484,419) | |||
Total liabilities | (490,742) | |||
Accumulated Deficit | (1,664,102) | |||
Total Reservoir Media, Inc. shareholders' equity | (1,664,102) | |||
Total shareholders' equity | (1,664,102) | |||
Total liabilities and shareholders' equity | (2,154,844) | |||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Net income (loss) | (49,498) | |||
Amortization of intangible assets | (19,522) | |||
Deferred income taxes | (16,499) | |||
Net cash provided by operating activities | (85,519) | |||
Purchases of music catalogs | 85,519 | |||
Net cash used for investing activities | $ 85,519 |