Universal Cash Flow Up In 3rd Quarter; Revenue Dips

Universal Music Group recorded a 12% increase in cash flow, year-over-year, for the three months ended Sept. 30, while revenues, stung by unfavorable exchange rates, dropped 7%, according to figures released yesterday by parent Seagram Co. Ltd.

The music group reports an increase in pro-forma cash flow, also known as earnings before interest, taxes, depreciation, and amortization (EBITDA), to $185 million, vs. $165 million a year ago. Revenues sank to $1.4 billion from $1.5 billion. The company blames the decline on divested operations, unfavorable foreign exchange, and a reduction in artist rosters. Without the foreign-exchange impact, EBITDA would have risen 18% due to savings from the PolyGram merger and strong chart performance from Shania Twain, Limp Bizkit, the "Notting Hill" soundtrack, Boyzone, and Nine Inch Nails.

Seagram as a whole reported a 13% decline in EBITDA for the quarter, to $352 million. Revenues were up 2% to $3.64 billion.

Shares in the company jumped more than $4 Wednesday before the announcement, hitting $41.50. Trading was flat yesterday; the stock closed at the same price.

--Brian Garrity, N.Y.


Radio-Station Owners Sue BMI Over Licensing Fees

The Radio Music License Committee--acting on behalf of Hicks Broadcasting of Indiana, owner of more than 2,900 U.S. radio stations--has sued BMI in an effort to resolve a stand-off between the stations and the performance rights group over new rate structures. The suit was filed Wednesday in U.S. District Court in New York.

The stations--making their first bid at court since a 1994 decree was amended to allow them to seek judicial assistance in setting rates--want to end blanket licensing and establish alternative forms of licensing. In a statement, the stations say the lawsuit follows "three years of unsuccessful negotiations."

BMI says in a statement, "This rate court was established for situations like this ? While we always prefer negotiations, it appears that the rate court is the appropriate way to go forward at this time."

The radio stations say their use of BMI has declined, while the society seeks an adjustment in fees to "reflect 10 years of substantially increased use of BMI music, while the use of other music has declined." According to BMI, the fees "net out to less than 1% of total radio industry revenues." ASCAP, also operating under a consent decree, has not yet started negotiations with the Radio Music License Committee.

--Irv Lichtman, N.Y


Bisceglia Splits Epic

Rick Bisceglia has exited as executive VP of Epic Records Group, a post he has held since August 1998. A Sony spokesperson says the move is not part of a larger restructuring.


New N-Coded President

Carl Griffin has been promoted from senior VP of A&R to president of N-Coded Music. Adam Levy, CEO of N-Coded and its majority-owner, Warlock Records, had been heading the New York-based label, whose acts include Candy Dulfer, Jonathan Butler, Arturo Sandoval, and T.S. Monk.


British Music Rights Names New Chief

Frances Lowe, international counsel of U.K. authors' rights body the MCPS-PRS Alliance, has been named director general of British Music Rights (BMR), the umbrella authors' body that groups together the British Academy of Composers and Songwriters, the Music Publishers Assn., the Mechanical Copyright Protection Society, and the Performing Right Society. Lowe takes up her new post Nov. 8, replacing Nanette Rigg, who is exiting to launch an entertainment and media consultancy.

--Tom Ferguson, London


Ads, Ratings Push MTV To 3rd-Quarter Gains

MTV Networks posted double-digit gains in revenue and earnings for the third fiscal quarter. Parent Viacom reports that MTV Networks' revenue rose 17% to $554 million in the three months ended Sept. 30 from the same period last year, on a 22% increase in earnings before interest, taxes, amortization, and depreciation to $251 million. Worldwide advertising revenue rose 21% in the quarter; ratings for VH1 and MTV increased by double digits. Revenue from Viacom's Internet operations, which include MTV Online, doubled to $6.6 million. The division lost $15.5 million, compared with earnings of $400,000 a year ago.

In September, Viacom and CBS agreed to merge; the deal is expected to close in the first half of next year.

Viacom's Class A shares rose 6.25 cents in New York Stock Exchange trading yesterday, to close at $41.1875.

--Don Jeffrey, N.Y.


Farrell Signs To Virgin

Former Jane's Addiction and Porno For Pyros front man Perry Farrell has inked a worldwide deal with Virgin Records. His first solo album, "The Diamond Jubilee," is due in April or May.

--Eileen Fitzpatrick, L.A.


Musicland Turns A Profit; Comp-Store Sales Are Flat

Musicland Stores Corp. reports net income of $728,000, or 2 cents per share, for the third fiscal quarter, compared with loss of $3.7 million, or 11 cents per share, in the same period a year ago. Earnings before taxes, interest, amortization, and depreciation rose 38.1% to $17.5 million. Sales from stores open at least a year were flat, the company says, because of difficult comparisons with last year's third quarter, when the retailer booked strong sales from the "Titanic" video. Overall sales dipped to $386.3 million from $387.3 million. Shares in the Minneapolis-based, 1,332-store chain fell 43.75 cents, or 2.2%, in New York Stock Exchange trading yesterday, closing at $8.25.

--Don Jeffrey, N.Y.


Losses Mount At MP3.com

Digital-music firm MP3.com Inc. had increased losses and a better-than-anticipated rise in revenues for the three months ended Sept. 30, its first reporting period as a public company.

The San Diego-based company lost $19.9 million, or 33 cents per diluted share, vs. losses of $33,341 a year ago. Revenues rose to $4.05 million from $276,577. The company attributes the losses to continued expansion. In a consecutive-quarter comparison, revenues were up $2.1 million from the second quarter; losses rose by $13.5 million.

For the nine months ended Sept. 30, the company had a net loss of $27.6 million on revenues of $6.63 million.

Shares in MP3.com rose $1.56, or 4.24%, on the news yesterday, closing at $38.44.

--Brian Garrity, N.Y.


DRG Label Seals 'Kiss' Deal

New York-based DRG Records has secured the original cast rights to the revival of Cole Porter's musical "Kiss Me, Kate," which opens Nov. 18 at the Martin Beck Theatre on Broadway. The production features Brian Stokes Mitchell and Marin Mazzie, both of whom starred in the original Broadway cast of "Ragtime." Recording date for the show is Nov. 22; the album is due Jan. 25, with distribution by Koch International. However, says Hugh Fordin, the president of DRG Records who also produces the label's cast recordings, it may be sold in the theater lobby before the new year.

"Kiss Me, Kate" first opened on Dec. 30, 1948. Surprisingly, it has had no major Broadway revival since.

--Irv Lichtman, N.Y.


Seagal To Host 1999 Billboard Video Awards

International film star Steven Seagal will host the 1999 Billboard Music Video Awards show, set for Nov. 12 at the Loews Santa Monica (Calif.) Beach Hotel. Seagal, who is also a musician, is recording his debut album. The awards are the finale to the Billboard Music Video Conference, to be held Nov. 10-12 at the hotel.


Report: Sheehan Died Of Accidental Overdose

A coroner has ruled that Bobby Sheehan, the Blues Traveler bassist who died two months ago (Bulletin, Aug. 23), accidentally overdosed on a combination of drugs, according to a report. Toxicology tests show that the 31-year-old had heroin, cocaine, and Valium in his system when he died at his home in New Orleans.


Aiwa Mini System To Incorporate CD-R To Incorporate CD-R

Aiwa America plans to introduce a mini audio system with a built-in CD recorder. The electronics manufacturer says the system, the XR-C3RW, will be the first mini component-based CD recorder. Available in November at a suggested list price of $700, the system will feature a CD-R/CD-RW recorder, a three-CD changer that will play CD-R and CD-RW discs, an AM/FM tuner, a cassette deck, a two-channel amplifier, and two speakers with built-in subwoofers.

--Paul Verna, N.Y.


Miles Seeking Label

Artist/producer Robert Miles, best known for the international hit "Children," is seeking a label for his third album, which he is recording in Ibiza, Spain. His previous releases were on Arista in the U.S. and BMG elsewhere. Miles has also split from his management company, London-based F&G.


For The Record

The Alanis Morissette track "These Are The Thoughts" is to be streamed at MP3.com. Due to inaccurate information supplied by the company, an item in yesterday's Bulletin stated that the track would be offered as a download.


What's On

Late-night tonight: Big Bad Voodoo Daddy (on Leno), Gloria Estefan (Conan O'Brien.)

Dr. Dre, Snoop Dogg, and Eminem play "Saturday Night Live" tomorrow.

Robert Cray and Kim Richey play "Sessions At West 54th" this weekend.