INTERIMFINANCIAL REVIEWFOR THE SIX MONTH PERIOD ENDED JUNE 30, 2023

INTERIM FINANCIAL REVIEWEARNINGS ANALYSIS
UMG Results
Six Months Ended June 30,(in millions of euros, number of shares in millions, data pershare in euros)

Revenue

2023

2022

(unaudited)(unaudited)

767

960

5,148

EBITDA1

Adjusted EBITDA

4,734

1,112

1

Operating profit

2

Net profit attributable to equity holders of the parent
Adjusted net profit

1,3

Net cash provided by operating activities before
income tax paid
Free cash flow1

962

591

767

625

241

754

664

703

605

(13)

104

Weighted average number of shares outstanding

1,817

1,813

Earnings attributable to UMG N.V. shareowners per
share - basic & diluted

0.34

0.13

Adjusted net profit per share - basic & diluted

0.41

0.37

Earnings per share

Adjusted net profit per share1,3

As at(in millions of euros)

Financial Net Debt

1.
2.
3.

June 30, 2023

(unaudited)1(2,300)December 31,
2022(audited)(1,810)Non-IFRS measures
2022 Restated amounts are presented in Note 2.3 of the Unaudited
Condensed Consolidated Interim Financial Statements
2022 Restated amounts are presented in the reconciliation of Adjusted net
profit and Adjusted net profit per share in this 2023 Interim Financial Review
and Appendix

This Interim Financial Review and Unaudited Condensed Consolidated Interim
Financial Statements includes certain alternative performance indicators which
are not defined in the International Financial Reporting Standards ("IFRS")
issued by the International Accounting Standards Board as endorsed by the EU.
The descriptions of these alternative performance indicators and reconciliationsof non-IFRS to IFRS measures are included in this report and its Appendix.
Reference may also be made to the 2022 Annual Report.

MUSIC IS UNIVERSAL Half Year Results 2023 | 2

INTERIM FINANCIAL REVIEW

Analysis of Operating Results
Revenues for the first half of 2023 were €5,148 million, up 8.7% compared to thefirst half of 2022 and up 9.1% at constant currency. This increase was driven
by improvements across all divisions. Recorded Music grew 10.3% at constantcurrency compared to the first half of 2022, Music Publishing was up 4.8% andMerchandising and Other grew by 5.6%.
For a detailed analysis of revenues by business segment, please refer to thepress release dated July 26, 2023 (the "press release") and to Note 3 to theUnaudited Condensed Consolidated Interim Financial Statements for the period
ended June 30, 2023.
Six Months Ended June 30,(in millions of euros)

Artist costs

Product costs

Cost of Revenues

2023

2022

(unaudited)(unaudited)

426

415

2,385

2,811

2,193

2,608

Cost of Revenues grew by €203 million to €2,811 million in the first half of 2023
from €2,608 million in the first half of 2022 reflecting the increase in revenues.
Cost of revenues as a percentage of revenues decreased to 54.6% from 55.1%
driven by lower relative Product costs.
Artist costs increased by €192 million from €2,193 million in the first half 2022
to €2,385 million in the first half 2023 driven by the increase in sales. As apercentage of revenues, artists costs was 46.3% in both first half 2023 and 2022.
Product costs increased by €11 million to €426 million in the first 6 months of2023 from €415 million in the first 6 months of 2022 reflecting the growth inrevenues. Product costs as a percentage of revenues decreased to 8.3% from
8.8% driven primarily by the change in mix of revenues and especially the lower
proportion of merchandising sales.
Selling, general and administrative expenses increased by €381 million to€1,611 million in the first half 2023 from €1,230 million in the first half 2022
and increased as a percentage of revenues to 31.3% in 2023 from 26.0% in
2022. Selling, general and administrative expenses in the first half 2023 included€345 million in non-cash share-based compensation expense while in the firsthalf 2022, selling, general and administrative expenses included €2 million in
non-cash share-based compensation expenses.
Operating profit was €591 million in the first half of 2023, compared to€767 million for the first half of 2022, a decrease of €176 million (-22.9%) ora decrease of 22.3% at constant currency, due to the higher non-cash sharebased compensation expense in 2023 partly compensated by the growth inrevenues. As a percentage of revenues, operating profit declined to 11.5% in
the first half 2023 from 16.2% in the first half 2022 due to the higher noncash share-based compensation expense partially offset by lower relative costof revenues.

MUSIC IS UNIVERSAL Half Year Results 2023 | 3

INTERIM FINANCIAL REVIEW

Reconciliation of Operating Profit to EBITDA and Adjusted EBITDA
Six Months Ended June 30,(in millions of euros)

2023

2022

(unaudited)(unaudited)

Amortisation and depreciation expense

187

182

(Gain)/loss on sale of assets

(26)

-

Operating profit1

591

Adjustments

Restructuring expenses

15

Impairment on intangible assets-

Non-cash share-based compensation expense
Adjusted EBITDA

11-

Other non-recurring items
EBITDA

767

-

767

960

1,112

962

345

2

1 2022 Restated amounts are presented in Note 2.3 of the Unaudited Condensed Consolidated Interim
Financial Statements

EBITDA decreased by €193 million to €767 million in the first half of 2023
compared to €960 million in the first half of 2022 due to the higher non-cash
share-based compensation expense partially compensated by the increase inrevenues. EBITDA margin decreased by 5.4pp to 14.9% in the first 6 months of2023 compared to 20.3% in the first 6 months of 2022.
For a detailed analysis of EBITDA by business segment, please refer to thepress release and to Note 3 to the Unaudited Condensed Consolidated Interim
Financial Statements for the period ended June 30, 2023.
Adjusted EBITDA was €1,112 million in the first half of 2023 up €150 million
compared to €962 million in the first half of 2022 due to the improved revenues.
Adjusted EBITDA margin increased by 1.3pp to 21.6% in the first 6 months of2023 from 20.3% in the first 6 months of 2022 driven by the revenue growth,
operating leverage and cash compensation savings of €33 million associatedwith the equity plan rollout.

Financial results
Financial income and Financial expenses were a net income of €265 million in
the first half 2023, compared to a net expense of €572 million in the first half
2022, an improvement of €837 million. For the first half 2023, the revaluation of
the investments in listed and other companies including Spotify and Tencent
Music Entertainment was a net income amount of €313 million, compared
to a net expense of €567 million for the first half 2022, an improvement of€880 million.

MUSIC IS UNIVERSAL Half Year Results 2023 | 4

INTERIM FINANCIAL REVIEW

Income taxes
For the first half of 2023, income taxes were a net expense of €227 million,
compared to a net income of €49 million in the first half of 2022. This
increase notably reflected the increase in the deferred tax charge relating to
the revaluation of the investments in listed companies including Spotify andTencent Music Entertainment (€84 million expense, compared to €140 million
income for first half of 2022) and the favourable settlement of tax litigations in
the first half of 2022 (€89 million).

Non-controlling interests
For the first half of 2023, earnings attributable to non-controlling interests were
€2 million, slightly higher than the €1 million with the first half of 2022.

Net profit attributable to equity holders of the parent
For the first 6 months of 2023, net profit attributable to equity holders of
the parent amounted to a profit of €625 million (or €0.34 per share - basic),
compared to €241 million for the first 6 months of 2022 (or €0.13 per share- basic). Net profit attributable to equity holders of the parent increased by€384 million, reflecting:•the improvement in Financial results (+€837 million) driven by thefavourable variance in the revaluation of the investments in listed andother companies including Spotify and Tencent Music Entertainment (+€880 million);
partially offset by:•
the decline in Operating Profit (-€176 million) driven by the higher non-cash
share-based compensation expense in the first half 2023; and•the increase in Income tax charges (-€276 million) due to the increase indeferred tax charge relating to the revaluation of the investments in listedcompanies (-€224 million) and the favourable settlement of tax litigations in
the first half of 2022 (-€89 million).

MUSIC IS UNIVERSAL Half Year Results 2023 | 5

INTERIM FINANCIAL REVIEW

Adjusted net profit
Reconciliation of Net profit attributable to equity holders of the parent to
Adjusted net profit
Six Months Ended June 30,(in millions of euros)

Net profit attributable to equity holders of the parent

2023

2022

(unaudited)(unaudited)

(300)

573

345

2

Financial income and expenses, excluding interestand income from investments1
Non-cash share-based compensation expense
Certain one time items

625

241

-

(11)

Amortisation of catalogues

120

113

Non-recurring tax items1-

1

Impairment of intangible assets-

Income tax on adjustments
Adjusted Net Profit

1

-

(36)

(165)

754

664

(89)

1 Adjusted Net Profit per the 2022 Interim Financial Review was €763m. As presented in the 2022 year end Annual
Report, Adjusted Net Profit in 2022 has been restated to exclude the beneficial impact of two litigations finalised
before tax courts in the first half 2022 ('Non-recurring tax item') and the related interest income ('Certain one
time items'). In addition, there is an immaterial impact from the change in interest income as presented in
Note 4 of the 2023 Unaudited Condensed Consolidated Interim Financial Statements.

Adjusted net profit in the first half 2023 amounted to a profit of €754 million (or€0.41 per share - basic), compared to €664 million for the first half 2022 (or €0.37
per share - basic). Adjusted net profit increased by €90 million, including:•
The growth in Adjusted EBITDA (+€150 million); partially offset by•
The increase in income taxes reported to adjusted net profit (-€58 million).

MUSIC IS UNIVERSAL Half Year Results 2023 | 6

INTERIM FINANCIAL REVIEWLIQUIDITY AND
CAPITAL RESOURCES
Financial Net Debt
As at
(in millions of euros)

Cash and cash equivalents
Derivative financial assets

Drawn revolving credit facilities

June 30, 2023

(unaudited)

December 31, 2022

463-

(audited)

439
1

(100)

(125)

Bonds

(1,731)(1,004)

Other

(186)

(191)

Bank overdrafts

Commercial papers
Borrowings at amortised cost
Financial Net Debt

(3)

(743)

(2,763)(2,300)

(1)

(929)

(2,250)(1,810)Changes in the Financial Net Debt
As of June 30, 2023, UMG’s Financial Net Debt amounted to -€2,300 million
compared to Financial Net Debt of -€1,810 million as of December 31, 2022, i.e.,
an increase in net debt of €490 million. This change was mainly attributable tothe following:•
UMG paid the final dividend with respect to fiscal year 2022 of which€453 million was paid in June 2023 and the associated withholding tax paidin July 2023;•
Net cash used for investing activities of €423 million, primarily due to the€89 million investment in Music Publishing and Recorded Music catalogues,€54 million net other intangible and capital expenditure and €283 million
net purchase of consolidated companies, equity affiliates and financial
assets relating to several strategic investments in the period; and•repayment of €47 million in relation to lease liabilities and associatedinterest and €38 million in other interest payments.
This was partially offset by the following:•
Net cash provided by operating activities of €495 million.
UMG believes that the cash flow generated by its operating activities, its cash
surpluses, net of amounts used to reduce UMG’s debt, as well as funds available
through undrawn bank credit facilities and additional funding opportunities will
be sufficient to cover expenses and investments necessary for its operations, its
debt service, the payment of income taxes, the distribution of dividends, as wellas its investment projects, if any, for the next 12 months.

MUSIC IS UNIVERSAL Half Year Results 2023 | 7

INTERIM FINANCIAL REVIEW

Equity portfolio
As of June 30, 2023, UMG held a portfolio of listed non-controlling equity
interests (including Spotify) with an aggregate market value of approximately€1,051 million (before taxes), compared to €597 million as of December 31, 2022.
The increase in market value during 2023 was due to the fluctuation in shareprice of our listed investments most notably of Spotify.

Cash flow analysis
Net cash provided by operating activities before income tax
For the first half of 2023, changes in net cash provided by operating activities
before income tax amounted to an inflow of €703 million compared to an inflowof €605 million for the first half of 2022, an improvement of €98 million. This
increase was mainly attributable to the following items:•
the decrease in Royalty advances payments net of recoupments (€128 million) due to the timing of major artist renewals and increased
recoupment; and•the favourable variance in Adjustments (+€200 million) on the offset of
the non-cash share based compensation expense reflected in Operating
profit net of the employee tax withheld (see breakdown of Adjustments in
the Appendix).
partially offset by:•
the decrease in Operating profit (-€176 million); and•the unfavourable variance in Other working capital (-€54 million) on thetiming of digital and other revenues received in advance.

Net cash provided by operating activities
Net cash provided by operating activities in the first 6 months of 2023 amounted
to an inflow of €495 million compared to an inflow €474 million for the first 6
months of 2022, an improvement of €21 million due to the €98 million increase
in Net cash provided by operating activities before income tax, partially offset by
the increase in Income tax paid (-€77 million) that last year benefited from thefavourable settlement of tax litigations.

Net cash used for investing activities
Net cash used for investing activities in the first half 2023 was a €423 million
net outflow compared to a €320 million net outflow for the first half 2022, anincreased outflow of €103 million. Catalogue investments in the first half of2023 were lower than in the first half of 2022 (+€175 million) due to the timingof deals. Investment in consolidated companies (-€75 million), equity affiliates(-€61 million) and financial assets (-€130 million) were higher than in the firsthalf of 2022 and represented various strategic investments entered into during
the period.

MUSIC IS UNIVERSAL Half Year Results 2023 | 8

INTERIM FINANCIAL REVIEWNet cash used for financing activities
Net cash used for financing activities in the first 6 months of 2023 was a€23 million net outflow compared to a €794 million net inflow for the first
6 months of 2022, an increased outflow of €817 million. This was mainly
attributable to the following items:•
an increase in debt in the first 6 months of 2023 of €516 million compared
to an increase in debt in the first 6 months of 2022 of €1,179 million (€663 million);•higher dividend payments in the first 6 months of 2023 (-€119 million); and•higher interest payments in the first half 2023 (-€38 million).

Reconciliation of cash provided by operating activities to Free Cash Flow
Six Months Ended June 30,(in millions of euros)

Net cash provided by/(used for) operating activities
before income tax paid

2023

2022

(unaudited)(unaudited)

703

605

Income tax paid

(208)

(131)

Net cash provided by/(used for) investing activities

(423)

(320)

(47)

(51)

-

1

Net cash provided by/(used for) operating activities
Repayment of lease liabilities and related
interest expenses
Interest, net

Other cash items related to financing activities
Free Cash Flow

495

(38)
(13)

474

-

104

Free Cash Flow
Free Cash Flow in the first half of 2023 was a €13 million net outflow compared toa €104 million net inflow for the first half of 2022, a decrease of €117 million. Thisdecrease was predominantly due to higher Net cash used for investing activities(-€103 million), higher Income tax paid (-€77 million) and higher Interest paid(-€38 million) partially offset by the improvement in Net cash provided byoperating activities before income tax paid (+€98 million) in the first half 2023
period compared to the first half of 2022.

MUSIC IS UNIVERSAL Half Year Results 2023 | 9

INTERIM FINANCIAL REVIEWCAUTIONARY STATEMENTS
Risk and uncertainties

The 2022 Annual Report on pages 115 to 134 outlines a number of risk factors
which UMG still believes are the key risks and uncertainties concerning thebusiness and industry in which UMG operates, and that alone or in combination
with other events or circumstances, could have a material adverse effect on
UMG’s business, results and financial position.

External auditors' involvement

The Interim Financial Review and Unaudited Condensed Consolidated Interim
Financial Statements have not been audited by UMG’s external auditors.

Related party transactions

Please refer to Note 11 of the Unaudited Condensed Consolidated Interim
Financial Statements for details on related party transactions.

Forward-looking statements

These Interim Financial Review and Unaudited Condensed Consolidated
Interim Financial Statements may contain statements that constitute forwardlooking statements with respect to UMG’s financial condition, results ofoperations, business, strategy and plans. Such forward-looking statements
may be identified by the use of words such as ‘profit forecast’, ‘expect’,‘estimate’, ‘project’, ‘anticipate’, ‘should’, ‘intend’, ‘plan’, ‘probability’, ‘risk’,‘target’, ‘goal’, ‘objective’, ‘will’, ‘endeavour’, ‘optimistic’, ‘prospects’ and similar
expressions or variations on such expressions. Although UMG believes thatsuch forward-looking statements are based on reasonable assumptions, they
are not guarantees of future performance. Actual results may differ materiallyfrom such forward-looking statements as a result of a number of risks anduncertainties, many of which are related to factors that are outside UMG’scontrol, including, but not limited to, UMG’s inability to compete successfully
and to identify, attract, sign and retain successful recording artists andsongwriters, failure of streaming and subscription adoption or revenue to growor to grow less rapidly than anticipated, UMG’s reliance on digital service
providers, UMG’s inability to execute its business strategy, the global nature of
UMG’s operations, UMG’s inability to protect its intellectual property and against
piracy, UMG’s inability to attract and retain key personnel, changes in laws andregulations and the other risks that have been described in UMG’s 2022 annual
report. Accordingly, UMG cautions readers against placing undue reliance onsuch forward-looking statements. Such forward-looking statements are madeas of the date of these Interim Financial Review and Unaudited Condensed
Consolidated Interim Financial Statements. UMG disclaims any intention or
obligation to provide, update or revise any such forward-looking statements,
whether as a result of new information, future events or otherwise.

MUSIC IS UNIVERSAL Half Year Results 2023 | 10

INTERIM FINANCIAL REVIEW

Responsibility statement

In accordance with article 5:25d(2)(c) of the Dutch Financial Supervision Act (Wetop het financieel toezicht), we confirm that, to the best of our knowledge:•
the Unaudited Condensed Consolidated Interim Financial Statements forthe six-month period ended June 30, 2023, which have been prepared inaccordance with IAS 34 ‘Interim Financial Reporting’ as adopted by theEuropean Union, give a true and fair view of the assets, liabilities, financial
position and result of the Company and the undertakings included in the
consolidation as a whole;•
the Interim Financial Review provides a true and fair view of the important
events that have occurred during the first six months of the financial
year, and their impact on the Unaudited Condensed Consolidated Interim
Financial Statements, together with a description of the principal risks anduncertainties for the remaining six months of the financial year, as well asof the major related parties transactions.
On behalf of the Board,
Sir Lucian Grainge, Executive Director, Chairman and Chief Executive Officer
Vincent Vallejo, Executive Director, Deputy Chief Executive Officer

MUSIC IS UNIVERSAL Half Year Results 2023 | 11

FINANCIAL REVIEWAPPENDIX

FINANCIAL REVIEW APPENDIXNON-IFRS ALTERNATIVEPERFORMANCE INDICATORSAND RECONCILIATIONS
UMG results by segment
Six months ended June 30,(in millions of euros)

Revenues

Recorded Music

Music Publishing

Merchandising & Other
Corporate Centre

Elimination of intersegment transactions
Total UMG

Adjusted EBITDA
Recorded Music

Music Publishing

Merchandising & Other
Corporate Centre
Total UMG

%

%

YoY

const.

2023

2022(unaudited)(unaudited)

4,003

3,643

9.9%

10.3%

264

248

6.5%

5.6%

889
-

851
-

4.5%
0.0%

4.8%
0.0%

(8)

(8)

5,148

4,734

8.7%

9.1%

969

842

15.1%

15.6%

14

42.9%

42.9%

962

15.6%

16.2%

216
20

(93)

1,112

200
(94)

8.0%

(1.1%)

8.0%(1.1%)

Note: % YoY indicates % change year-over-year; % const. indicates % change
year-over-year adjusted for constant currency. Constant currency change iscalculated by taking current year results and comparing against prior year
results restated at current year rates.

MUSIC IS UNIVERSAL Half Year Results 2023 | 13

FINANCIAL REVIEW APPENDIX

Recorded MusicSix months ended June 30,(in millions of euros)

Subscriptions andstreaming revenueof which streamingof which subscription
Downloads and otherdigital revenue

2023

2022

(unaudited)(unaudited)

2,755

2,524

673

Recorded Music revenues
Adjusted EBITDA

Adjusted EBITDA margin%

YoY

const.

9.2%
2.3%

9.1%
1.8%

2,082

1,866

11.6%

11.6%

116

137

(15.3%)(14.7%)

639

540

18.3%

20.8%

4,003

3,643

9.9%

10.3%

15.1%

15.6%

Physical revenue

License and other revenue

658

%

493

442

969

842

24.2%

23.1%

11.5%

1.1pp

12.6%

Note: % YoY indicates % change year-over-year; % const. indicates % change
year-over-year adjusted for constant currency.

Recorded Music revenues by geographic area
Six months ended June 30,(in millions of euros)

North America
EMEA

1

Asia

Latin America

Rest of the world

Recorded Music revenues

2023

2022

(unaudited)(unaudited)

1,094

1,052

2,024
579
165
141

4,003

%

%

YoY

const.

1,821

11.1%

8.9%

476

21.6%

29.5%

148

(4.7%)

146
3,643

4.0%

13.0%
9.9%

5.9%

13.0%

(2.1%)

10.3%

1 This was previously titled Europe. No change in the perimeter reported.

Note: % YoY indicates % change year-over-year; % const. indicates % change
year-over-year adjusted for constant currency.

MUSIC IS UNIVERSAL Half Year Results 2023 | 14

FINANCIAL REVIEW APPENDIXMusic Publishing
Six months ended June 30,(in millions of euros)

Performance revenue

2023

%

%

YoY

const.

127

47.2%

48.4%

537

(7.8%)(7.5%)

2022(unaudited)(unaudited)

129

120

187

Synchronisation revenue
Digital revenue

495

Mechanical revenue

52

Other revenue

26

13.0%

15.6%

4.5%

4.8%

21

889

851

Adjusted EBITDA

216

200

24.3%

6.6%

46

Music Publishing revenues

Adjusted EBITDA margin

7.5%

23.5%

23.8%
8.0%

0.8pp

23.8%
8.0%

Note: % YoY indicates % change year-over-year; % const. indicates % change
year-over-year adjusted for constant currency.

Merchandising and OtherSix months ended June 30,(in millions of euros)

Merchandising andother revenues
Adjusted EBITDA

Adjusted EBITDA margin

%

%

YoY

const.

2023

2022(unaudited)(unaudited)

264

248

6.5%

5.6%

20

14

42.9%

42.9%

7.6%

5.6%

2.0pp

Note: % YoY indicates % change year-over-year; % const. indicates % change
year-over-year adjusted for constant currency.

MUSIC IS UNIVERSAL Half Year Results 2023 | 15

FINANCIAL REVIEW APPENDIX

Net cash provided by operating activities - Adjustments

Operating profit includes certain non-cash items that are adjusted to get to the
Net cash provided by operating activities as follows:
Six months ended June 30,(in millions of euros)

Amortisation and depreciation expense

2023

2022

(unaudited)(unaudited)

220

2

187

Non-cash share-based compensation expense, net of
employees tax withheld
Impairment of intangible assets

182-

Changes in provisions, net

(4)

-

-

(Gain)/loss on sale of assets(26)

Adjustments

380

Other non-recurring items

-

(1)

-

180

Adjusted net profit per share
Six months ended June 30,(in millions of euros)

Adjusted Net Profit

2022(unaudited)(unaudited)

1,817

1,813

6

1

1,823

1,814

0.41

0.37

754

1

Number of shares (in millions)

Weighted average number of shares outstanding
Potential dilutive effects related tosharebased compensation

Adjusted weighted average number of shares
Adjusted net profit per share (in euros)

2023

Adjusted net profit per share - basic & diluted

664

1 2022 Restated amounts are presented in the reconciliation of Adjusted net profit in this 2023 Interim
Financial Review

MUSIC IS UNIVERSAL Half Year Results 2023 | 16

FINANCIAL REVIEW APPENDIX

DEFINITIONSIn this Interim Financial Review, UMG presents certain financial measures when
discussing UMG’s performance that are not measures of financial performanceor liquidity under IFRS (“non-IFRS”). These non-IFRS measures (also known
as alternative performance measures) are presented because management
considers them important supplemental measures of UMG’s performance andbelieves that they are widely used in the industry in which UMG operates asa means of evaluating a company’s operating performance and liquidity. UMG
believes that an understanding of its sales performance, profitability, financial
strength and funding requirements is enhanced by reporting the following nonIFRS measures. All non-IFRS measures should be considered in addition to,and not as a substitute for, other IFRS measures of operating and financial
performance as presented in UMG’s Unaudited Condensed Consolidated Interim
Financial Statements and the related Notes. In addition, it should be notedthat other companies may use definitions and calculations for these non-IFRS
measures that differ from those used by UMG, thereby affecting comparability.

EBITDA and EBITDA margin

UMG considers EBITDA and EBITDA margin, non-IFRS measures, to be relevantmeasures to assess the performance of its operating segments as reported in
the segment data. It enables UMG to compare the operating performance of
operating segments regardless of whether their performance is driven by theoperating segment’s organic growth or by acquisitions. EBITDA margin is EBITDA
divided by revenue.
To calculate EBITDA, the accounting impact of the following items is excluded
from Operating Profit:i. amortisation of intangible assets
ii. impairment losses on goodwill and other intangibles
iii. other income and expenses related to transactions with shareowners(except when directly recognized in equity)
iv. depreciation of tangible assets including right of use assetsv. (gains)/losses on the sale of tangible assets, including right of use assets
and intangible assets
vi. restructuring expenses
vii. other non-recurring items

Adjusted EBITDA and Adjusted EBITDA margin

The difference between EBITDA and Adjusted EBITDA consists of non-cash
share-based compensation expenses and certain one-time items that are
deemed by management to be significant and incidental to normal businessactivity. Adjusted EBITDA margin is Adjusted EBITDA divided by revenue.
UMG considers Adjusted EBITDA and Adjusted EBITDA margin, non-IFRS
measures, to be relevant measures to assess performance of its operating
segments excluding items that may be incidental to normal business activity.

MUSIC IS UNIVERSAL Half Year Results 2023 | 17

FINANCIAL REVIEW APPENDIX

Adjusted Net Profit/Adjusted Net Profit per share

UMG considers the use of Adjusted net profit appropriate as UMG uses it as
the basis for the Adjusted net profit per share (in EUR) – diluted, both of which
are non-IFRS measures. Adjusted net profit may be subject to limitations as ananalytical tool for investors, as it excludes certain items and therefore does notreflect the expense associated with such items, which may be significant andhave a significant effect on UMG’s net profit.

The accounting impact of the following items is excluded from Net profit
attributable to equity holders of the parent:
i. amortisation of catalogues
ii. impairment losses on goodwill and intangible assets
iii. other charges and income related to transactions with shareowners
iv. financial income and expenses, excluding interest and income
from investments
v. earnings from discontinued operations
vi. non-cash share-based compensation expenses
vii. certain one-time items that are deemed by management to be significant
and incidental to normal business activity
viii. income taxes and adjustments attributable to non-controlling interests
ix. non-recurring tax items

Financial Net Debt

UMG considers financial net debt, a non-IFRS measure, to be a relevant indicatorof the Group’s liquidity and capital resources. UMG management uses thisindicator for reporting, management and planning purposes. Financial Net Debt
is calculated as the sum of:i. cash and cash equivalents, as reported in the Consolidated Statement of
Financial Position, including (i) cash in banks and deposits, whether or notcompensated, corresponding to cash, and (ii) money market funds
ii. cash management financial assets, included in the Consolidated Statementof Financial Position under “financial assets”, relating to financial
investments, which do not satisfy the criteria for classification as cash
equivalents set forth in IAS 7
iii. derivative financial instruments, net (assets and liabilities) where theunderlying instruments are Financial Net Debt items, as well as cash
deposits securing borrowings included in the Consolidated Statement of
Financial Position under “financial assets”
less:i. the value of borrowings at amortised cost as reported in the Consolidated
Statement of Financial Position

MUSIC IS UNIVERSAL Half Year Results 2023 | 18

FINANCIAL REVIEW APPENDIXFree Cash Flow

UMG defines Free Cash Flow as net cash provided by/(used for) operating
activities plus net cash provided by/(used for) investing activities, lessrepayment of lease liabilities, interest, net and other cash items related tofinancing activities. UMG considers free cash flow, a non-IFRS measure, to be arelevant indicator of the Group’s cashflow generated to fund dividend payments
and repayment of debt. Free Cash Flow is not a measure of performance
calculated in accordance with IFRS and therefore it should not be considered inisolation of, or as a substitute for cash flow provided by operating activities as ameasure of liquidity. Free Cash Flow, as we calculate it, may not be comparable
to similarly titled measures employed by other companies. In addition, Free
Cash Flow does not necessarily represent funds available for discretionary use
and is not necessarily a measure of our ability to fund our cash needs.

MUSIC IS UNIVERSAL Half Year Results 2023 | 19

UNAUDITED CONDENSEDCONSOLIDATED INTERIMFINANCIAL STATEMENTS
FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2023

Condensed Consolidated Interim
Financial Statements
Contents of Condensed Consolidated Interim Financial Statements
Condensed Consolidated Interim Statement of Profit or Loss

Condensed Consolidated Interim Statement of Comprehensive Income
Condensed Consolidated Interim Statement of Financial Position
Condensed Consolidated Interim Statement of Cash Flows

Condensed Consolidated Interim Statement of Changes in Equity

Notes to the Condensed Consolidated Interim Financial Statements
Note 1.

General information

Note 3.

Segment data

Note 2.
Note 4.
Note 5.
Note 6.
Note 7.
Note 8.
Note 9.

Note 10.
Note 11.
Note 12.

Basis of preparation

Financial income and expenses
Income taxes

22
23

24

25

26
27

27
27
29
33
34

Content assets (catalogues and royalty advances) andother intangibles

34

Financial assets and liabilities

36

Cash position and borrowings
Equity35
38

Share-based compensation plans

38

Subsequent events

40

Related parties

39

FINANCIAL STATEMENTSCONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS FOR THE SIX-MONTHS ENDED
30 JUNE, 2023

Condensed Consolidated InterimStatement of Profit or Loss
Six months ended June 30,(in millions of euros)

Note

2023

2022
Restated1

Revenues

Cost of revenues

3

Selling, general and administrative expenses

Financial income

Financial expenses

4
4

Income/(loss) from equity affiliates
Profit before income taxes
Income taxes
Net profit
Of which:

Net profit attributable to equity holders of the parent
Net profit attributable to non-controlling interests

Earnings per share (in euros)

Earnings for the period attributable to equity holders of the parent - basic & diluted

5,148

4,734

(2,608)

(135)

(129)

591
339

(74)

(1,230)
767

21

(593)

265

(572)

854

193

627

242

625

241

0.34

0.13

(2)

5

(unaudited)(2,811)(1,611)

Amortisation and impairment losses on intangible assets
Operating profit(unaudited)

(227)

2

(2)

49

1

1 Restated amounts are presented in Note 2.3.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF PROFIT OR LOSSMUSIC IS UNIVERSAL Half Year Results 2023 | 22

FINANCIAL STATEMENTS

Condensed Consolidated InterimStatement of Comprehensive Income
Six months ended June 30,(in millions of euros)

Net profit

Actuarial gains/(losses) related to employee defined benefit plans, net of tax

Financial assets at fair value through other comprehensive income, net of tax
Items not subsequently reclassified to profit or loss, net of tax

2023

2022

(unaudited)(unaudited)

627
-

(1)

(1)

242
35
5

40

Foreign currency translation adjustments

(134)

257

Net gain/(loss) on hedge of net investment

7-

Comprehensive income/(loss) from equity affiliates, net of tax(3)-

Items to be subsequently reclassified to profit or loss, net of tax

(130)

257

Total comprehensive income, net of tax

496

539

Income and expenses directly recognised in equity, net of tax

Of which

Total comprehensive income attributable to equity holders of the parent
Total comprehensive income attributable to non-controlling interests

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

(131)

494
2

297

538
1

MUSIC IS UNIVERSAL Half Year Results 2023 | 23

FINANCIAL STATEMENTS

Condensed Consolidated InterimStatement of Financial Position(in millions of euros)

Goodwill

Note

Non-current royalty advances

6

Other intangible assets

6

Catalogues

Property, plant and equipment

6

Right of use assets

Investments in equity affiliates
Non-current financial assets
Deferred tax assets

June 30,

December 31,

2023

2022

(unaudited)(audited)

1,622
1,505
2,992
162
171
303

8

Other non-current assets

209

1,228
390

8

Non-current assets

1,578
1,593
3,058
119
167
318
156
690
348
8

8,590

8,035

204

163

967

984

2,069

2,014

3,861

3,604

TOTAL ASSETS

12,451

11,639

Shareowners equity

2,557

2,351

Total equity

2,559

2,352

290

291

Inventories

Current tax receivables

Current royalty advances

Other current financial assets
Trade and other receivables
Cash and cash equivalents
Current assets

68
7

Non-controlling interests
Non-current provisions

Long-term borrowings and other financial liabilities
Deferred tax liabilities

Long-term lease liabilities

Other non-current liabilities
Non-current liabilities
Current provisions

Short-term borrowings and other financial liabilities
Trade and other payables

Short-term lease liabilities
Current tax payables

79
79

463

2

7

8

7

4
-

439

1

1,830

1,113

319

346

691
546

580
437

3,676

2,767

101

103

933

1,137

83

77

5,021
78

5,150
53

Current liabilities

6,216

6,520

Total liabilities

9,892

9,287

TOTAL EQUITY AND LIABILITIES

12,451

11,639CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITIONMUSIC IS UNIVERSAL Half Year Results 2023 | 24

FINANCIAL STATEMENTS

Condensed Consolidated InterimStatement of Cash FlowsSix months ended June 30,(in millions of euros)

2023

2022
Restated1

Operating activities(unaudited)(unaudited)

Operating profit

591

767

Royalty advances payments, net of recoupments

(95)

(223)

Other changes in net working capital

(173)

(119)

Income tax paid

(208)

(131)

Catalogue investments

(89)

(264)

Capital expenditures

(22)

(10)

Adjustments

Gross cash provided by operating activities before income tax paid
Net cash provided by operating activities before income tax paid
Net cash provided by operating activities
Investing activities

Other intangible assets investments
Purchases of consolidated companies, after acquired cash
Investments in equity affiliates
Purchase of financial assets

Investments

Proceeds from sales of consolidated companies, after divested cash
Proceeds from sale of financial assets

Divestitures

Dividends received from equity affiliates
Dividends received from investments
Net cash used for investing activities
Financing activities

Distributions to shareowners

Dividends paid by consolidated companies to their non-controlling interests

Transactions with shareowners
Proceeds from borrowings

Repayments of borrowings
Interest, net

Other cash items related to financing activities

Transactions on borrowings and other financial liabilities
Repayment of lease liabilities

Payment of interest of lease liabilities

Net cash provided by/(used for) financing activities
Net change in cash and cash equivalents

Foreign currency translation adjustments
Change in cash and cash equivalents
Cash and cash equivalents
At beginning of the period
At end of the period

380

876
703
495

(32)
(78)
(61)

(145)

180

724

605
474

(31)
(2)
-

(18)

(427)

(325)

-

3

1

1
3
-

-

3
1
1

(423)

(320)

(453)

(334)

(1)

(454)

4,776

(1)

(335)

2,576

(4,260)(1,397)

-

1

(38)

478

(40)
(7)

-

1,180

(44)
(7)

(23)

794

49

948

22

963

(27)

438
460

15

572

1,535

1 Restated amounts are presented in Note 2.3.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWSMUSIC IS UNIVERSAL Half Year Results 2023 | 25

FINANCIAL STATEMENTS

Condensed Consolidated InterimStatement of Changes in Equity
Six months ended June 30, 2023 (unaudited)
Number(in millions of euros)

paid-

capital(in thousands)

BALANCE AS OF DECEMBER 31, 2022

Additional

Shareof shares

in capital

Treasury

Retained

Shareowners

sharesearnings

equityNonControllinginterest

Total
equity1,813,513

18,135

14,935(5)(30,714)

2,351

1

2,352

-

-

-

-

625

625

2

627

-

-

-

-

(131)

(131)

-

(131)

TOTAL COMPREHENSIVE INCOME

-

-

-

-

494

494

2

496

Dividends paid and payable by UMG N.V.

-

-

-

-

(492)

(492)

(1)

(493)

7,225

72

59

-

88

219

-

219

-

-

-

-

(15)

(15)

-

(15)

7,225

72

59

-

(419)

(288)

(1)

(289)

1,820,738

18,207

14,994(5)(30,639)

2,557

2

2,559

Net profit
Income and expenses directly recognized inequity, net of tax

Share-based compensation plans
Acquired put option on NCI
TOTAL CHANGES OVER THE PERIODBALANCE AS OF JUNE 30, 2023

Six months ended June 30, 2022 (unaudited)
Number(in millions of euros)
BALANCE AS OF DECEMBER 31, 2021

Additional

Shareof shares

paid-

capital(in thousands)

in capital

Treasury

Retained

Shareowners

sharesearnings

equityNonControllinginterest

Total
equity1,813,376

18,134

14,941(12)(31,033)

2,030

-

2,030

-

-

-

-

241

241

1

242

-

-

-

-

297

297

-

297

TOTAL COMPREHENSIVE INCOME

-

-

-

-

538

538

1

539

Dividends paid and payable by UMG N.V.

-

-

-

-

(363)

(363)

(1)

(364)

Share-based compensation plans

-

-

1

-

-

1

-

1

TOTAL CHANGES OVER THE PERIOD

-

-

1

-

(363)

(362)

(1)

(363)

1,813,376

18,134

14,942(12)(30,858)

2,206

-

2,206

Net profit
Income and expenses directly recognized inequity, net of tax

BALANCE AS OF JUNE 30, 2022

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITYMUSIC IS UNIVERSAL Half Year Results 2023 | 26

FINANCIAL STATEMENTS

Notes to the Condensed Consolidated
Interim Financial Statements
Note 1. General information
Universal Music Group N.V. is a public company with limited liability incorporated under the laws of the Netherlands
and listed on Euronext Amsterdam under the symbol ‘UMG.AS’. As used herein, the term UMG ("the Group") is used for
Universal Music Group N.V. (‘the Company’) and its subsidiaries within the meaning of Section 2:24b of the Dutch Civil
Code. UMG’s statutory seat is located in Amsterdam and its principal office is located at:‘s-Gravelandseweg 80,
1217 EW Hilversum
The Netherlands

Note 2. Basis of preparation
The Unaudited condensed consolidated interim financial statements ("Condensed consolidated interim financial
statements") are presented in millions of euros, unless stated otherwise. The presentation currency of UMG is the euro.

2.1. Statement of compliance
These Condensed consolidated interim financial statements are in compliance with IAS 34 'Interim Financial Reporting'and do not include all the information and disclosures required in the annual financial statements, and should beread in conjunction with UMG's annual consolidated financial statements for the year ended December 31, 2022. These
Condensed consolidated interim financial statements were prepared by the UMG Board of Management and authorized
for issue on July 25, 2023.
The accounting policies adopted in the preparation of the Condensed consolidated interim financial statements are
consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year
ended 31 December 2022, except for the adoption of new or amended standards and interpretations effective for annual
periods beginning on or after January 1, 2023. None of these new or amended standards or interpretations had a material
impact on adoption.
On May 23, 2023, the IASB issued International Tax Reform—Pillar Two Model Rules – Amendments to IAS 12. These
amendments introduce a mandatory temporary exception to IAS 12 recognition and disclosure requirements resulting
from tax laws enacted or substantively enacted to implement the Organisation for Economic Co-operation andDevelopment (OECD) Pillar Two tax reform. These amendments also introduce targeted disclosure requirements first
applicable to UMG’s annual consolidated financial statements for the year ended December 31, 2023. These amendments
are not yet endorsed by the EU. No material recognition and measurement impact is expected from the amendments
because UMG does not recognise deferred tax assets and liabilities with respect to Pillar Two income taxes. UMG isevaluating the disclosure impact on the 2023 annual consolidated financial statements.

2.2. Crticial accounting judgements and key sources of estimation uncertainty
The preparation of the Condensed consolidated interim financial statements requires management to make judgments,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from the estimates. The significant judgments and estimates

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 27

FINANCIAL STATEMENTS

are consistent with those disclosed in UMG's annual consolidated financial statements for the year ended December
31, 2022.
The income tax expense is recognised based on management's estimate of the weighted average effective annual
income tax rate expected for the full year. The accounting policies applied in the Condensed consolidated interim
financial statements are consistent with those applied in UMG's annual consolidated financial statements for the year
ended December 31, 2022.

2.3. Financial statement presentation changes and prior years restatements
During the period, UMG made prior year restatements and updated, compared to the 2022 Condensed consolidated
interim financial statements, the presentation of the Condensed Consolidated Interim Statement of Profit or Loss andthe Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 2022, to further improvetransparency and readability of these statements in line with market practice.
Updates in the Condensed Consolidated Statement of Profit or Loss relate to a restatement of amortisation expense fromselling, general and administrative expenses into its own line item and the reclassification of income and losses fromequity affiliates from within Operating profit to be reported outside of Operating profit to reflect that they do not constituteoperating activities of UMG. Details on the impact on 2022 comparatives for the six months ended June 30, 2022 ispresented in the table below.
June 30, 2022
Presentation

Before Changes

Revenues

Cost of revenues

After Changes

Changes

4,734-(1,359)129-(2,608)

-

(129)

(129)

Operating profit

765

2

767

Financial expenses

(592)

(1)

(593)

-

(2)

49

-

Selling, general and administrative expenses

Amortisation and impairment losses on intangible assets
Income/(loss) from equity affiliates
Financial income

Income/(loss) from equity affiliates(2,608)

4,734

(2)

20

(572)

Profit before income taxes

193

Net profit

242

Net profit attributable to equity holders of the parent

241

Income taxes
Of which:

Net profit attributable to non-controlling interests

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

12
1(1,230)
-

21

-

(572)

-

193

-

242

-

241

-

(2)

49

1

MUSIC IS UNIVERSAL Half Year Results 2023 | 28

FINANCIAL STATEMENTS

The Condensed Consolidated Statement of Cash Flows includes the same reclassification of income and losses fromequity affiliates from Operating profit and adjustments as well as a retrospective adjustment to the comparative period
in relation to the cash flows resulting from bank overdrafts which are repayable on demand. In prior years, cash flows
related to bank overdrafts repayable on demand were reported together with borrowings movements as cash flows
from financing activities. Bank overdrafts are now presented in cash and cash equivalents at the beginning and end of
the period.
June 30, 2022
Before Changes

Operating activities
Operating profit

765Royalty advances payments, net of recoupments(223)

Other changes in net working capital(119)

Income tax paid(131)

Net cash used for investing activities

Adjustments

Gross cash provided by operating activities before income tax paid
Net cash provided by operating activities before income tax paid
Net cash provided by operating activities
Financing activities

Transactions with shareowners
Proceeds from borrowings

Repayments of borrowings
Interest, net

Other cash items related to financing activities

Transactions on borrowings and other financial liabilities
Repayment of lease liabilities

Payment of interest of lease liabilities

Restatement

After Changes

2

767

-

(223)

-

(119)

-

(131)

(320)

-

(320)

(335)

-

(1,405)8(1,397)

1

-

1

182

(2)

724

-

605

474

2,576
-

1,172

(44)
(7)

-

-

8
-

180

724

605
474

(335)

2,576

-

1,180

(44)
(7)

Net cash provided by financing activities

786

8

794

Net change in cash and cash equivalents

940

8

948

Change in cash and cash equivalents

955

8

963

585

(13)

572

Foreign currency translation adjustments
Cash and cash equivalents
At beginning of the period
At end of the period

15

1,540

-

(5)

15

1,535

Note 3. Segment data
Operating segment data

The operating segment reporting follows the internal reporting used by Management of UMG, to manage the business,
assess the performance based on the available financial information and to allocate the resources. The most important
performance measures are EBITDA and Adjusted EBITDA, non-IFRS measures as management believes these measures
are key in evaluating the results of the segments relative to other companies that operate within the same industry.
EBITDA and Adjusted EBITDA are defined in the Appendix of the 2023 Interim Financial Review.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 29

FINANCIAL STATEMENTS

Main aggregates of the Statement of profit or loss
Recorded(in millions of euros)

Six months ended June 30, 2023

Music

Music

Merchandising

Publishingand other

Corporate
centre

4,003

882

263

-

Revenues

4,003

889

264

Non-cash share-based
compensation expense(271)

EBITDA

Amortisation and depreciation expense

Adjusted EBITDA

Restructuring expenses

Gain/(loss) on sale of assets
Operating profit/(loss)
Financial income

intersegment
transactions

External revenue

Intercompany revenue

Elimination of

-

5,148

20

-

(93)

(8)
-

5,148

1,112

(30)

(3)

(41)

-

(345)

698

186

17

(134)

-

767

(105)

(78)

(1)

(3)

-

(187)

26

-

-

7

969

216

(14)

1

(1)

-

-

579

107

-

-

16

-

(111)

(8)

-

Financial expenses

Music

Music

Merchandising

Publishingand other

Corporate
centre

3,643

845

246

-

Revenues

3,643

851

248

-

EBITDA

Amortisation and depreciation expense

Non-cash share-based
compensation expense

Restructuring expenses

Gain/(loss) on sale of assets
Operating profit/(loss)1
Financial income

Elimination ofintersegment
transactions

External revenue

Adjusted EBITDA

26

591
339

854

RecordedIntercompany revenue

(15)

(2)

Profit before income taxes

Six months ended June 30, 2022

-

(74)

Income/(loss) from equity affiliates(in millions of euros)

Total

Total

-

4,734

14

-

(94)

(8)

4,734

-

-

(2)

-

(2)

842

200

14

(96)

-

960

(89)

(80)

-

(13)

-

(182)

-

-

-

842

(11)
-

742

6

200

-

120

2

-

14

-

-

(108)

(8)
-

-

-

962

(11)
-

767
21

Financial expenses(593)

Profit before income taxes

193

Income/(loss) from equity affiliates(2)

1 Restated amounts are presented in Note 2.3.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 30

FINANCIAL STATEMENTS

Disaggregated revenue information
Recorded MusicSix months ended June 30,(in millions of euros)

2023

Streaming revenue

2022

673

Subscription revenue

Downloads and other digital revenue

658

2,082

1,866

639

540

116

Physical revenue

License and other revenue

137

493

Recorded Music revenue

442

4,003

3,643

Music Publishing
Six months ended June 30,(in millions of euros)

2023

2022

Performance revenue

187

127

Digital revenue

495

537

Synchronisation revenue
Mechanical revenue
Other revenue

Music Publishing revenue

129
52
26

889

120
46
21

851

Subscriptions and streaming represents the largest type of recorded music revenue and is recognised over time and is
54% (53% in HY 2022) of total UMG revenues. Physical recorded music revenues are recognised at a point in time andrepresent 12% (11% in HY 2022) of total UMG revenues.
Other Recorded Music revenues mostly include neighbouring rights income which are recognized over time.
Merchandising revenue is recognised at a point in time. Music Publishing revenue is mostly recognised over time.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 31

FINANCIAL STATEMENTS

Segment assets
Segment assets by Segment

Segment assets that are reported to the Management of UMG include items that are directly attributable to a segment aswell as those that can be allocated on a reasonable basis. Unallocated assets mainly comprise of cash and deferred tax
assets which are managed at the Group level.

(in millions of euros)

Recorded

Music

Music

As of June 30, 2023

Merchandising

Publishingand other

Corporate

Total

centreGoodwill

775

747

100

-

1,622

Catalogues

1,272

1,720

-

-

2,992

50

26

499

431

37

6,728

4,051

423

Royalty advances, non-current

832

Property, plant & equipment

156

Other intangible assets

Right of use relating to leases

441

4

296

Royalty advances, current
Other assets

2,848

Total segment assets
Unallocated assets

232
-

11

-

2

-

5

677

-

1,505
171

86

162
303

-

54

967

218

3,797

317

11,519932

Total assets

12,451

As of December 31, 2022
Goodwill

709

769

100

-

1,578

Catalogues

1,247

1,811

-

-

3,058

23

23

464

476

44

5,984

4,145

407

Royalty advances, non-current

938

Property, plant & equipment

152

Other intangible assets

Right of use relating to leases

441

5

311

Royalty advances, current
Other assets

2,140

Total segment assets
Unallocated assets

214
-

10

1

2

-

4

616

-

1,593
167

73

119
318

-

48

984

227

3,031

312

10,848791

Total assets

11,639Content assets by segment
June 30, 2023
(in millions of euros)

Note

Catalogues (of music and publishing rights)

Royalty advances (to artists and repertoire owners)

Non-current
Content assets, net

Current content assets

Music

Music

Publishing6

Non-current content assets

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

Merchandising

Total

and other

1,272

1,720
872

269

-

2,992

832

441

232

1,505

2,603

2,592

269

5,464

2,104

2,161

232

4,497

1,331

Of which:
Current

Recorded

499
499

431
431

37
37

2,472

967
967

MUSIC IS UNIVERSAL Half Year Results 2023 | 32

FINANCIAL STATEMENTS

December 31, 2022
(in millions of euros)

Note

Recorded

Catalogues (of music and publishing rights)

Royalty advances (to artists and repertoire owners)

Non-current
Content assets, net

Current content assets

Publishing

1,247

1,811

6

Non-current content assets

Merchandising

Total

and other

917

-

258

3,058

938

441

214

1,593

2,649

2,728

258

5,635

2,185

2,252

214

4,651

1,402

Of which:
Current

Music

Music

464
464

476

2,577

44

476

984

44

984

Note 4. Financial income and expenses
Six months ended June 30,(in millions of euros)Interest income from cash, cash equivalents and other

Change in fair value of financial instruments through profit or loss
Expected return on plan assets related to employee benefit plans

Note

8

Gain on derivative instruments at fair value through profit or loss
Other

Unwinding of interest component

Interest cost related to employee benefit plans
Interest expenses on lease liabilities
Foreign exchange loss

7

14

-

2

3

-

327

-

Financial income

Change in fair value of financial instruments through profit or loss

2022

2

Foreign exchange gain

Interest expense on borrowings

2023

339
8

(41)

(13)

(3)

(3)

-

(1)

(1)
(7)

Financial expenses(74)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1

21

(567)

(8)

Net total financial income and (expenses)

4

(14)

Cost of finance
Other

-

-

265

-

(7)
(1)
(1)

(593)
(572)

MUSIC IS UNIVERSAL Half Year Results 2023 | 33

FINANCIAL STATEMENTS

Note 5. Income taxes
The income tax expense in the first six months of 2023 increased by €276 million to an income tax expense of€227 million from an income tax benefit of €49 million in the corresponding period of the previous year. The increase
was mainly caused by benefits in the previous half year related to the revaluation through profit or loss of the interests in
Spotify and other equity holdings and the beneficial impact of two tax litigations finalised before tax courts.

Note 6. Content assets (catalogues and royalty advances) and otherintangibles
Net book value
June 30, 2023

(in millions of euros)

Asset value, grossAccumulated

amortisation andimpairment losses

Net book value

Catalogues (of music and publishing rights)

5,714(2,722)

2,992

Content assets

8,186(2,722)

5,464

Royalty advances (to artists and repertoire owners)
Other intangible assets

2,472
546

-

(384)

2,472
162

December 31, 2022

(in millions of euros)

Asset value, grossAccumulated

amortisation andimpairment losses

Net book value

Catalogues (of music and publishing rights)

5,732(2,674)

3,058

Content assets

8,309(2,674)

5,635

Royalty advances (to artists and repertoire owners)
Other intangible assets

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

2,577
489

-

(370)

2,577
119

MUSIC IS UNIVERSAL Half Year Results 2023 | 34

FINANCIAL STATEMENTS

Note 7. Cash position and borrowings
Cash position(in millions of euros)

June 30, 2023

December 31, 2022

Cash and cash equivalents

463

439

Cash and cash equivalents in the statement of cash flows

460

438

Bank overdrafts

(3)

(1)

Borrowings and other financial liabilities
June 30, 2023
(in millions of euros)

Bonds

Total

December 31, 2022

Long-term

Short-term

Total

Long-term

Short-term

1,731

1,729

2

1,004

987

17

100

100

-

125

125

-

Commercial papers

743

-

743

929

-

929

Other

Drawn revolving
credit facilities
Bank overdrafts

3

-

3

1

-

1

Borrowings at
amortised cost

186

1

185

191

1

190

2,763

1,830

933

2,250

1,113

1,137

Cash and cash equivalents

(463)

-

(463)

(439)

-

(439)

Net debt

2,300

Derivative financial assets

-

-

-

(1)

1,810

-

(1)

New borrowings

In June 2023, UMG issued €750 million of senior unsecured notes due on June 13, 2031 with a coupon of 4.00%.
In March 2023, UMG entered into a short-term bilateral floating rate €500 million revolving credit facility. The facility
matures 12 months from the signing date.
In February 2023, UMG extended the original maturity of the syndicated floating rate €2 billion revolving credit facility. The
maturity date was extended for two years up to April 26, 2028. All other conditions remained unchanged.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 35

FINANCIAL STATEMENTS

Note 8. Financial assets and liabilities
The following table shows the carrying amounts and fair values of financial assets and liabilities according to their fairvalue hierarchy. Based on the nature, maturity or the magnitude of the amounts, UMG considers that the fair valueof trade and other receivables, short-term deposits, loans receivable, borrowings, trade and other payables are notmaterially different from their carrying value.
Fair value hierarchy is based on the transparency of the inputs used and is as follows:•
Level 1: fair value measurement based on quoted prices in active markets for identical assets or liabilities;•
Level 2: fair value measurement based on observable market data (other than quoted prices included under Level 1),
being for example, price on the last transactions on over-the-counter (OTC) markets; and•Level 3: fair value measurement based on valuation techniques using inputs for the asset or liability that are notbased on observable market data.
June 30, 2023
Fair value(in millions of euros)

Carrying

Level 1amountFinancial assets at fair value through profit and loss
Listed equity securities
Other financial assets

Trade and other receivables

Financial assets at fair value through othercomprehensive income
Listed equity securities through OCI

Level 2

1,051

1,051

-

-

75

Level 3

-

-

60
-

-

15

-

Unlisted equity securities

17

-

-

-

17

Trade and other receivables

2,069

-

-

-

Total financial assets

3,376

1,051

60

32

(15)

-

-

(15)

Trade and other payables(5,021)---

Borrowings, excluding bank overdrafts and bonds(1,029)---Financial assets at amortised cost
Other financial assets

Financial liabilities at fair value through profit and loss
Other non-current liabilities

Financial liabilities at amortised cost
Bonds

Other non-current liabilities
Total financial liabilities

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

164

-

-

(1,731)(1,716)(531)-(8,327)(1,716)

-

-

-

-

-

(15)

MUSIC IS UNIVERSAL Half Year Results 2023 | 36

FINANCIAL STATEMENTS

December 31, 2022
Fair value
Carrying(in millions of euros)

Level 11amountFinancial assets at fair value through profit and loss
Listed equity securities
Other financial assets

Level 2

597

597

1

-

51

Trade and other receivables

Financial assets at fair value through othercomprehensive income
Listed equity securities through OCI

Level 3

-

-

36

-

15

1

-

Unlisted equity securities

19

1

1

-

19

Trade and other receivables

2,013

-

-

-

Total financial assets

2,704

598

37

34

-

-

-

-

Trade and other payables(5,150)---Borrowings, excluding bank overdrafts and bonds(1,245)---

Financial assets at amortised cost
Other financial assets-

22

Financial liabilities at fair value through profit and loss
Other non-current liabilities

Financial liabilities at amortised cost
Bonds

Other non-current liabilities
Total financial liabilities-(1,004)

(987)

(437)

-

(7,836)

-

-

-

-

-

-

(987)

-

-

-

1 Includes transfer of €31 million of equity securities from level 2 to level 1.

Listed equity portfolio
June 30, 2023
Numberof shares
held

Ownership
interest(inTencent
Music Entertainment

purchaseprice1,2

Stockmarketprice(€/share)thousands)

Spotify

Average

Carrying
value

ChangeCumulative

overcapitalin valuethe period

unrealized

gain/(loss)3

Sensitivity

at +/- 10 pts(in millions of euros)

6,487

3.29%

6.58

146.85

953

470

910

+95/-95

12,246

0.78%

na

6.75

83

(13)

83

+8/-8

15

(3)

(12)

Other
Total

1,051

454

981

1 Includes acquisition fees and taxes.
2 na: not applicable.
3 Includes revaluation gains, net of liabilities, of €313 million in HY 2023 (revaluation losses, net of liabilites, of €547 million in HY 2022) as recognised in Note 4.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 37

FINANCIAL STATEMENTS

December 31, 2022
Numberof shares
held

Ownership
interest(inTencent
Music Entertainment

purchaseprice1,2

Stockmarketprice

Carrying

ChangeCumulative

overcapitalin valuevalue(€/share)thousands)

Spotify

Averagethe period

unrealized
gain/(loss)

Sensitivity

at +/- 10 pts(in millions of euros)

6,487

3.30%

6.58

74.41

483

(856)

440

+48/-48

12,246

0.76%

na

7.80

96

22

96

+10/-10

18

18

18

Other
Total

597

(816)

554

1 Includes acquisition fees and taxes.
2 na: not applicable.

Note 9. Equity
Dividend Distribution
In May 2023 the proposal submitted to the 2023 Annual General Meeting of Shareholders to pay a cash dividend of €0.27
per ordinary share was approved. This corresponded to a total distribution of €492 million which is included within theCondensed Consolidated Interim Statement of Changes in Equity. The dividend was paid in June 2023 to shareholders,
except for withholding tax which was settled in July 2023.

Note 10. Share-based compensation plans
As detailed in the UMG's 2022 Annual Report, in 2022 UMG granted to senior executives certain Restricted Stock Units(RSUs) and Performance Stock Units (PSUs) under the UMG Global Equity Plan. During the first half of 2023, further RSUs
and PSUs were granted to further executives and a number of senior management. The total expense reflected in the
period for all granted RSUs was €305 million and for all granted PSUs was €16 million.
In addition, during the first half of 2023, 8,625 stock options were granted to a senior executive with expected vesting
periods between 3 and 5 years and a grant date fair value of €5.3 per option. The total expense reflected in the period forthese options was €3 million.
The total equity reserve at 30 June 2023 for all granted awards was €196 million.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 38

FINANCIAL STATEMENTS

Note 11. Related parties
Related-party transactions

UMG's related parties include:•companies fully consolidated by UMG. The transactions between these companies have been eliminated for the
preparation of UMG’s Condensed consolidated interim financial statements;•
companies over which UMG exercises a significant influence or has joint control;•
all companies that are controlled or jointly controlled by Corporate Executives or their close relatives;•
minority shareholders exercising a significant influence over UMG’s subsidiaries; and•all companies that have a significant influence over UMG.
As of June 30, 2023, transactions with Vivendi are still qualified as transactions with related parties under IAS 24.
Commercial relationships among UMG and Vivendi subsidiaries prior and upon the separation, are conducted on anarm’s length basis on terms and conditions similar to those which would be offered by third parties.
UMG distributes its cash surpluses to shareowners through dividends (please refer to Note 9 Equity). Vivendi and UMG
had previously entered into a transition and services agreement in connection with the separation, the terms of which
Vivendi and its subsidiaries will provide to UMG, and UMG will provide to Vivendi and its subsidiaries, on an interim,various transitional basis services as applicable, including but not limited to: (i) a limited selection of treasury related
services and applications; (ii) a limited selection of accounting services and accounting software related services andapplications; (iii) taxation related services; and (iv) certain employee related principles in connection with the direct
listing on the Euronext Amsterdam. This transition and services agreement ceased in the first half of 2023.
The balances and transactions with the parties described above are summarised in the table below:
June 30, 2023
(in millions of euros)

Associates

Shareholders

Other

Total

Statement of Financial Position
AssetsTrade accounts receivable

Loans and other receivables

44

1

-

-

-

23

-

105

-

-

-

105

Royalty advances
Liabilities

Trade accounts payable

-

-

45

23

Six months ended June 30, 2023
(in millions of euros)

Associates

Statement of Profit or Loss
Revenue

Cost of revenues

Selling, general and administrative expenses
Services billed by Shareholders included in profit and loss
Share-based compensation plans

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

Shareholders

Other

Total

123

2

-

125

(2)

(1)

-

(3)

-

-

-

-

-

-

-

-

MUSIC IS UNIVERSAL Half Year Results 2023 | 39

FINANCIAL STATEMENTS

December 31, 2022
(in millions of euros)

Associates

Shareholders

Other

Total

Statement of Financial Position
AssetsTrade accounts receivable

49

6

-

55

Royalty advances

-

-

25

25

1

-

Loans receivable

17

Liabilities

Trade accounts payable

-

-

-

17
-

1

Six months ended June 30, 2022
(in millions of euros)

Associates

Statement of Profit or Loss
Revenue

Cost of revenues

Selling, general and administrative expenses
Services billed by Shareholders included in profit and loss
Share-based compensation plans

Shareholders

130

Other

5

-

135

(2)

(41)

(44)

1

-

1

-

(4)

-

(1)

Total

-

(4)

Note 12. Subsequent events
There have been no material subsequent events.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

MUSIC IS UNIVERSAL Half Year Results 2023 | 40