Exhibit 18 

 

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Warner Music International Services 

Limited 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

A49 30/06/2023 

COMPANIES HOUSE 

#184 

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Directors 

P Robinson 

S Rishi 

R Lougee (appointed 11 March 2022) 

C Saxe (appointed 30 September 2022) 

Secretary 

Olswang Cosec Limited 

• Cannon Place 

78 Cannon Street 

London 

EC4N 6AF 

Auditor 

KPMG 

I Stokes Place 

St Stephen's Green 

Dublin 2 

Ireland 

Registered Office 

Cannon Place 

78 Cannon Street 

London 

EC4N 6AF 

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Contents 

Strategic Report 

Directors' Report 

Statement of Directors' responsibilities in respect of the Strategic Report, Directors' Report and the financial 

statements 

Independent auditor's report to the members of Warner Music International Services Limited 

Profit and Loss Account and Other Comprehensive Income 

Balance Sheet 

Statement of Changes in Equity 

Notes 

1-2 

3-4 

5 

6-9 

10 

11 

12 

13-24 

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Strategic Report 

Warner Music International Services limited 

Annual report and financial statements 

30 September 2022 

The Directors present their report and financial statements for the year ended 30 September 2022. 

Principal activity and review of business 

The Company has two main functions. The first is the provision of services to most of its recorded music worldwide 

affiliates. These services are provided pursuant to agreements with the worldwide affiliates and include the provision 

of marketing, promotion and related activity in respect of current releases, strategic advice in respect of catalogue 

repertoire together with general financial and accounting services, royalty processing services, information technology, 

human resources and legal services. The second, established in October 2018, is to act as a central licensing hub for 

WMG catalogue, having been assigned all ex-US WMG Digital Service Provider (DSP) contracts. 

The company's key financial and other performance indicators during the year were as follows: 

2022 2021 Change % 

$m $m 

Turnover 1,521.7 1,361.3 11.8 

Gross profit 535.5 493.5 8.5 

Shareholders' funds 195.0 185.1 5.3 

Turnover has increased by 11.8% as a result of new deals and renegotiation of current deals. The gross profit has 

increased by 8.5% as a result of increase in turnover partially offset by an increase in cost of sales. Shareholders' funds 

increased by 5.3%, at a lower rate than gross profit, as a dividend of $6.7m was declared and paid in March 2022. 

Principal risks and uncertainties 

The main risks and uncertainties facing the company relate to maintaining and developing relationships with new and 

existing digital services providers and the strength of the global release schedule. Other principal risks and uncertainties 

include: 

Credit risk 

Market risk 

Exchange rate risk 

Interest rate risk 

Section 172 Statement 

The possibility that customers may be unable to settle amounts due. The directors do 

not consider the potential downside significant given the quality of internal credit 

controls and consistent monitoring performed by Treasury. 

The possibility of general market decline caused by changes in consumer habits. The 

directors do consider the potential downside significant given the current upwards 

trend in music consumption. 

The possibility of unfavourable exchange rate fluctuations. The directors do not 

consider the potential downside significant given the consistent monitoring performed 

by Treasury who agree favourable rates wit.h external facilities. 

The company does not have any significant external borrowings and as such the 

directors consider the interest rate risk to be minimal. 

The Directors define the successful running of the Company as supporting the group in achieving its wider long-term 

strategy. The group's long-term strategy is to be a sustainable profitable business, maintaining its reputation as the 

home to an unparalleled family of creative artists and songwriters. The success of the Company and group is dependent 

on positive and effective dealings with all stakeholders and so the Directors were mindful of the long-term 

consequences of key commercial decisions made during the year and determined that these were in the interests of the 

group's employees, suppliers, customers and other stakeholders, as they were all aligned to the group's growth strategy. 

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Strategic Report (continued) 

Section 172 Statement (continued) 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

The Company's and group's success depends on the company's reputation with customers and other stakeholders being 

maintained, and so any impact on the community and environment of commercial decisions is considered carefully. 

The company regularly engages with stakeholders to maintain these important relationships 

The key decisions taken during the year related to the signing of new deals and renewals of expiring deals with Digital 

Service Providers. • 

The Company maintains and encourages open .dialogue with its employees and runs events and initiatives on a wide 

range of topics throughout the year to promote a safe and comfortable working environment. 

The Directors confirm that throughout the year they have acted, in good faith, in a way that they consider to be most 

likely to promote the success of the Company and the group for the benefit of its members as a whole. 

On behalfofthe board 

r-:OocuSigned by: 

L~~~~ n.ul',:n 1..,uug,:,: 

Director28 June 2023 

Date 

Cannon Place 

78 Cannon Street 

London 

EC4N 6AF 

2 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Directors' Report 

The Directors present their report and financial statements for the year ended 30 September 2022. 

Results and dividends 

The profit for the year after taxation amounted to $16.Sm (2021 - profit of $13.1 m). The directors paid a dividend of 

$6. 7m in 2022 (2021 - $23m). 

Research and Development 

There were no Research and Development costs incurred during the financial year. The company continues to invest 

in keeping the IT systems and infrastructure up to date whilst striving to streamline operations. 

Financial Instruments 

Tlie significant Financial Instruments within the company are Trade Debtors and Investments which are measured in 

line with the company's accounting policies. There are no significant impairments on the Financial Instruments within 

these Financial Statements. 

Directors 

The directors who served the company during the year were as follows: 

R Lougee (appointed 11 March 2022) 

J Radice (resigned 30 September 2022) 

S Rishi 

P Robinson 

C Saxe (appointed 30 September 2022) 

Employees 

The Directors recognise the importance of maintaining a Diverse and Inclusive workplace and work alongside the inhouse Diversity, Equality and Inclusion (DE&!) team to ensure a safe and friendly environment within the Company. 

Throughout the year the company performs anonymous surveys to gauge employee's views on key topics including 

Diversity and Inclusion, Employee Wellbeing and Flexibly Working to support decision making. The Company also 

supports Employee Resource Groups which include: The Link (our people of colour network), Women of Warner, 

Women in Tech, Parents and Carers, People of Pride (LGBT+ network), and The Green Team (Environmental). 

Employees are required to comply with our internal Code of Conduct and complete specific training modules designed 

to meet the requirements of their roles along with access to many optional learning modules. Covid-19 has impacted 

everyone, including our employees, many of whom have been working from home in line with government 

requirements. As a result, the Company shared specific wellbeing tool kits to ensure employees were supported in 

working from home, alongside the provision of office equipment for home use. 

Engagement with suppliers, customers, and others in a business relationship with the Company 

The Company maintains strong relationships with customers and suppliers locally and overseas through ongoing 

communication and engagement. Due Diligence measures are taken when engaging new customers and suppliers to 

ensure compliance with our anti-corruptions and anti-bribery p9licies. The Company endeavours to pay suppliers in a 

timely manner in line with internal policies and specific contract terms and conditions. 

Political Contributions 

The Company made no political donations or incurred any political expenditure during the year. 

Statement of corporate governance arrangements 

The Company has engaged external consultants to build and develop on the Corporate Governance framework with 

actions taken as a result, such as further training to employees on Anti-bribery and Anti-corruption. 

3 

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Directors' Report (continued) 

Emissions and energy consumption· 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

In accordance with disclosure requirements for large companies under the Companies Act 2006, the table below shows 

the Company's greenhouse gas emissions during the financial year. 

The methodology used to calculate our emissions is in line with UK Government Streamlined Energy and Carbon 

Reporting ("SECR") guidelines. 

Combustion of fuel and operation of facilities (Scope 1) 

Electricity, heat, steam and cooling (Scope 2) 

Other indirect emissions relating to electricity transmission and distribution losses, Air travel 

and non-company cars (Scope 3) 

Air travel 

Non-company cars 

Total 

tCO2e per employee 

Going concern 

2022 

tCO2e 

85.57 

159.11 

1,109.14 

2.18 

1,431.19 

4.90 

2021 

tCO2e 

137.53 

206.3 

67.94 

20.51 

432.27 

1.81 

The financial statements have been prepared on a going concern basis which the Directors consider to be appropriate 

given the following considerations. 

Directors considered the operating nature of the entity, including the trading arrangements with affiliated entities and 

expectations for the future trading along with the outstanding inter-company payables and inter-company receivables 

for a period of 12 months from the date of approval of these financial statements which indicate that, taking account of 

reasonably possible downsides, the company will have sufficient funds through funding from its ultimate parent Warner 

Music Group Corp and repayment of outstanding balances from fellow subsidiaries to meet its liabilities as they fall 

due for that period. 

Those forecasts are dependent on Warner Music Group Corp. not seeking repayment of the amounts currently due to 

the group, at the date of the approval of these financial statements, providing additional financial support during that 

period, and continuing the existing, contracted trading arrangements across the Group. Warner Music Group Corp. has 

indicated its intention to continue to make available such funds as are needed by the company, and that it does not 

intend to seek repayment of the amounts due at the balance sheet date, for the period covered by the forecasts. The 

directors also have no reason to believe that trading arrangements with affiliated entities will materially change in the 

foreseeable future. As with any company placing reliance on other group entities for financial support, the Directors 

acknowledge that there can be no certainty that this support will continue although, at the date of approval of these 

financial statements, they have no reason to believe that it will not do so. 

Consequently, the Directors are confident that the company will have sufficient funds to continue to meet its liabilities 

as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared 

the financial statements on a going concern basis. 

Disclosure of information to the auditor 

So far as each person who was a Director at the date of approving this report is aware, there is no relevant audit 

information, being information needed by the auditor in connection with preparing its report, of which the auditor is 

unaware. Having made enquiries of fellow directors and the company's auditor, each Director has taken all the steps 

that they are obliged to take as a Director in order to make themselves aware of any relevant audit information and to 

establish that the auditor is aware of that information. 

Auditor 

Pursuant to Section 487 of the Companies Act 2006, the auditor will be deemed to be reappointed and KPMG, 

Chartered Accountants will therefore continue in office. 

On behalfofthe board 

r:DocuSlgned by: 

L~YiL~ ._.,....,..., ...... a...,v1.1e, ... .., 

Director 

Date: 28 June 2023 

Cannon Place 

78 Cannon Street 

London, EC4N 6AF 

4 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Statement of directors' responsibilities in respect of the Strategic Report, the 

Directors' Report and the financial statements 

The Directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in 

accordance with applicable law and regulations. 

Company law requires the directors to prepare financial statements for each financial year. Under that law they have 

elected to prepare the financial state.ments in accordance with UK accounting standards and applicable law (UK 

Generally Accepted Accounting Practice), including FRS 102 The Financial Reporting Standard applicable in the UK 

and Republic of Ireland. 

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a 

true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. l n 

preparing these financial statements, the directors are required to: 

• select suitable accounting policies and then apply them consistently; 

• make judgements and estimates that are reasonable and prudent; 

• state whether applicable UK accounting standards have been followed, subject to any material departures disclosed 

and explained in the financial statements; 

• assess the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going 

concern; and 

• use the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, 

or have no realistic alternative but to do so. 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 

Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and 

enable them to ensure that the financial statements comply with the Companies Act 2006. They are responsible for 

such internal control as they determine is necessary to enable the preparation of financial statements that are free from 

material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are 

reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities. 

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KPMG 

Audit 

1 Stokes Place 

St. Stephen's Green 

Dublin 2 

D02 DE03 

Ireland 

Independent auditor's report to the members of Warner Music International 

Services Limited 

Report on the audit of the financial statements 

Opinion 

We have audited the financial statements of Warner Music International Services Limited ('the company') 

for the year ended 30 September 2022 set out on pages 10 to 24, which comprise the profit and loss 

account, the balance sheet, the statement of changes in equity and related notes, including the summary 

of significant accounting policies set out in note 1. The financial reporting framework that has been applied 

in their preparation is UK Law and FRS 102 The Financial Reporting Standard applicable in the UK and 

Republic of Ireland 

In our opinion: 

• the financial statements give a true and fair view of the state of the Company's affairs as at 30 

September 2022 and of its profit for the year then ended; 

• the financial statements have been properly prepared in accordance with FRS 102 The Financial 

Reporting Standard applicable in the UK and Republic of Ireland; and 

• the financial statements have been prepared in accordance with the requirements of the 

Companies Act 2006. 

Basis for opinion 

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and 

applicable law. Our responsibilities under those standards are further described in the Auditor's 

responsibilities for the audit of the financial statements section of our report. We are independent of the 

company in accordance with ethical requirements that are relevant to our audit of financial statements in 

the UK, including the Financial Reporting Council (FRC)'s Ethical Standard, and we have fulfilled our 

other ethical responsibilities in accordance with these requirements. 

We believe that the audit evidence we have qbtained is sufficient and appropriate to provide a basis for 

our opinion. 

Conclusions relating to going concern 

The directors have prepared the financial statements on the going concern basis as they do not intend to 

liquidate the Company or to cease its operations, and as they have concluded that the Company's 

financial position means that this is realistic. They have also concluded that there are no material 

uncertainties that could have cast significant doubt over its ability to continue as a going concern for at 

least a year from the date of approval of the financial statements ("the going concern period"). 

In our evaluation of the directors' conclusions, we considered the inherent risks to the Company's 

business model and analysed how those risks might affect the Company's financial resources or ability to 

continue operations over the going _concern period. 

Based on the work we have performed, we have not identified any material uncertainties relating to events 

or conditions that, individually or collectively, may cast significant doubt on the Company's ability to 

continue as a going concern for a period of at least twelve months from the date when the financial 

statements are authorised for issue. 

t<PMG, an Irish oarmershio &nd s member firm of the KPMC global 

organisatio."' ot independent mel"l"lber !irms affiliated with KPMG 

lnterr.ationar Urr.ited. a priv.Jte English company limited by guarantee. 

6 

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Independent auditor's report to the members of Warner Music International 

Services Limited (continued) 

Report on the audit of the financial statements (continued) 

Conclusions relating to going concern (continued) 

Our responsibilities and the responsibilities of the directors with respect to going concern are 

described in the relevant sections of this report. 

However, as we cannot predict all future events or conditions and as subsequent events may result in 

outcomes that are inconsistent with judgements that were reasonable at the time they were made, the 

absence of reference to a material uncertainty in this auditor's report is not a guarantee that the 

Company will continue in operation. 

Detecting irregularities including fraud 

We identified the areas of laws and regulations that could reasonably be expected to have a material 

effect on the financial statements and risks of material misstatement due to fraud, using our 

understanding of the entity's industry, regulatory environment and other external factors and inquiry 

with the directors. In addition, our risk assessment procedures included: inquiring with the directors as 

to the Company's policies and procedures regarding compliance with laws and regulations and 

prevention and detection of fraud; inquiring whether the directors have knowledge of any actual or 

suspected non-compliance with laws or regulations or alleged fraud; inspecting the Company's 

regulatory and legal correspondence; and reading Board minutes. 

We discussed identified laws and regulations, fraud risk factors and the need to remain alert among 

the audit team. 

The Company is subject to laws and regulations that directly affect the financial statements including 

companies and financial reporting legislation. We assessed the extent of compliance with these laws 

and regulations as part of our procedures on the related financial statement items, including 

assessing the financial statement disclosures and agreeing them to supporting documentation when 

necessary. 

We assessed events or conditions that could indicate an incentive or pressure to commit fraud or 

provide an opportunity to commit fraud. As required by auditing standards, we performed procedures 

to address the risk of management override of controls. On this audit we do not believe there is a 

fraud risk related to revenue recognition. We did not identify any additional fraud risks 

In response to risk of fraud, we also performed procedures including: identifying journal entries to test 

based on risk criteria and comparing the identified entries to supporting documentation; evaluating the 

business purpose of significant unusual transactions; assessing significant accounting estimates for 

bias; and assessing the disclosures in the financial statements. 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have 

detected some material misstatements in the financial statements, even though we have properly 

planned and performed our audit in accordance with auditing standards. For example, the further 

removed non-compliance with laws and regulations (irregularities) is from the events and transactions 

reflected in the financial statements, the less likely the inherently limited procedures required by 

auditing standards would identify it. 

In addition, as with any audit, there remains a higher risk of non-detection of irregularities, as these 

may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal 

controls. We are not responsible for preventing non-compliance and cannot be expected to detect 

non-compliance with all laws and regulations. 

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Independent auditor's report to the members of Warner Music International 

Services Limited (continued) 

Report on the audit of the financial statements (continued) 

Other information 

The directors are responsible for the other information presented in the Annual Report together with 

the financial statements. The other information comprises the information included in the strategic 

report and the directors' report. The financial statements and our auditor's report thereon do not 

comprise part of the other information. Our opinion on the financial statements does not cover the 

other information and, accordingly, we do not express an audit opinion or, except as explicitly stated 

below, any form of assurance conclusion thereon. 

Our responsibility is to read the other information and, in doing so, consider whether, based on our 

financial statements audit work, the information therein is materially misstated or inconsistent with the 

financial statements or our audit knowledge. Based solely on that work we have not identified material 

misstatements in the other information. 

Opinions on other matters prescribed by the Companies Act 2006 

Based solely on our work on the other information undertaken during the course of the audit: 

• we have not identified material misstatements in the strategic report and the directors' report; 

• in our opinion, the information given in the strategic report and directors' report is consistent 

with the financial statements; 

• in our opinion, the strategic report and directors' report has been prepared in accordance with 

the Companies Act 2006. 

Matters on which we are required to report by exception 

Under the Companies Act 2006 we are required to report to you if, in our opinion 

• adequate accounting records have not been kept, or returns adequate for our audit have not 

been received from branches not visited by us; or 

• the financial statements are not in agreement with the accounting records and returns; or 

• certain disclosures of directors' remuneration specified by law are not made; or 

• we have not received all the information and explanations we require for our audit; or 

We have nothing to report in these respects. 

Respective responsibilities and restrictions on use 

Responsibilities of directors for the financial statements 

As explained more fully in the directors' responsibilities statement set out on page 5, the directors are 

responsible for: the preparation of the financial statements including being satisfied that they give a 

true and fair view; such internal control as they determine is necessary to enable the preparation of 

financial statements that are free from material misstatement, whether due to fraud or error; 

assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters 

related to going concern; and using the going concern basis of accounting unless they either intend to 

liquidate the Company or to cease operations, or have no realistic alternative but to do so. 

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Independent auditor's report to the members of Warner Music International 

Services Limited (continued} 

Respective responsibilities and restrictions on use 

Auditor's responsibilities for the audit of the financial statements 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole 

are free from material misstatement, whether due to fraud, other irregularities or error, and to issue an 

opinion in an auditor's report. Reasonable assurance is a high level of assurance but is not a 

guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material 

misstatement when it exists. Misstatements can arise from fraud, other irregularities or error and are 

considered material if, individually or in the aggregate, they could reasonably be expected to influence 

the economic decisions of users taken on the basis of these financial statements. 

A fuller description of our responsibilities is provided on the FRC's website at 

www.frc.orq.uk/auditorsresponsibilities. 

The purpose of our audit work and to whom we owe our responsibilities 

Our report is made solely to the Company's members, as a body, in accordance with Chapter 3 of 

Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to 

the Company's members those matters we are required to state to them in an auditor's report and for 

no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to 

anyone other than the Company and the Company's members, as a body, for our audit work, for this 

report, or for the opinions we have formed. 

:·.,···· .. • : .· 

'. ... ... . . _ .... 

Maurice Mccann (Senior Statutory Auditor) 

for and on behalf of 

KPMG Statutory Auditor 

1 Stokes Place 

St. Stephen's Green 

Dublin 2 

29 June 2023 

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DocuSign Envelope ID: 6065483D-5A5D-49AE-AE86-7A95CCDBD5A0 

Profit and Loss Account 

for year e11ded 30 September 2022 

Turnover 

Cost of sales 

Gross profit 

Administrative expenses 

Distribution expenses 

Operating (loss)/profit 

Interest receivable and similar income 

Interest payable and similar expenses 

Other income/( expenses) 

Profit before taxation 

Tax 

Profit for the financial year 

Other Comprehensive Income 

for year emled 30 September 2022 

Note 

2 

3 

6 

7 

8 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

2022 2021 

$000 $000 

1,521,714 1,361,343 

(986,261) (867,835) 

535,453 493,508 

(446,277) (378,157) 

(100,908) (98,326) 

(11,732) 17,025 

10,267 9,600 

(432) (655) 

29,153 (4,438) 

27,256 21,532 

(10,718) (8,389) 

16,538 13,143 

The company had no other comprehensive income for the year ended 30 September 2022 (2021: $nil). 

The notes on pages 13 to 24 fonn part of these financial statements. 

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DocuSign Envelope ID: 60654B3D-5A5D-49AE-AE86-7A95CCDBD5A0 

Balance Sheet 

at 30 September 2022 

Note 

Fixed assets 

Tangible assets 9 

Investments JO 

Current assets 

Cash at bank and in hand 

Debtors due in less than one year 11 

Creditors: amounts falling due within one 12 

year 

Net current assets 

Net assets 

Capital and reserves 

Called up share capital 14 

Share premium 

Profit and loss account 

Shareholders' funds 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

2022 2021 

$000 $000 

3,666 1,905 

166,375 166,375 

170,041 168,280 

1,029 2,257 

618,157 831,541 

619,186 833,7988 

(594,212) (816,948) 

24,974 16,850 

195,015 185,130 

130,520 130,520 

26,151 26,151 

38,344 28,459 

195,015 185,130 

These financial statements were approved by the board of directors and were signed on its behalf by: 

The notes on pages 13 to 24 form part of these financial statements. 

r-::OocuSlgned by: 

L~~B~~ Kupen Lougee 

Director 

28 June 2023 

Date: 

Company registered number: 02258593 

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DocuSign Envelope ID: 60654B3D-5A5D-49AE-AE86-7A95CCDBD5A0 

Statement of Changes in Equity 

Called up 

Share 

capital 

$000 

At 26 September 2020 130,520 

Profit for the year 

Dividend paid 

Balance at 24 September 2021 130,520 

Profit for the year 

Dividend paid 

Balance at 30 September 2022 130,520 

The notes on pages 13 to 24 form part of these financial statements. 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Share Profit and Total equity 

Premium loss account 

$000 $000 $000 

26,151 38,316 194,987 

13,143 13,143 

(23,000) (23,000) 

26,151 28,459 185,130 

16,538 16,538 

(6,653) (6,653) 

26,151 38,344 195,015 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Notes To The Financial Statements at 30 September 2022 

1 Accounting policies 

Warner Music International Services Limited (the "Company") is a company limited by shares and incorporated and 

domiciled in the UK. 

The Company is exempt by virtue of s401 of the Companies Act 2006 from the requirement to prepare group financial 

statements. These financial statements present information about the Company as an individual undertaking and not 

about its group. 

These financial statements were prepared in accordance with Financial Reporting Standard 102 The Financial 

Reporting Standard applicable in the UK and Republic of Ireland ( "FRS 102 "). The presentation currency of these 

financial statements is US Dollar($). All amounts in the financial statements have been rounded to the nearest $1,000. 

The Company's ultimate parent undertaking includes the Company in its consolidated financial statements, and is 

considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under 

FRS 102 in respect of the following disclosures: 

• Reconciliation of the number of shares outstanding from the beginning to end of the period; 

• Cash Flow Statement and related notes; and 

• Key Management Personnel compensation. 

As the consolidated financial statements of the ultimate parent undertaking include the equivalent disclosures, the 

Company has also taken the exemptions under FRS I 02 avai table in respect of: 

• The disclosures required by FRS I 02.11 Basic Financial Instruments in respect of financial instruments not 

falling within the fair value accounting rules of Paragraph 36( 4) of Schedule I. 

The Company proposes to continue to adopt the reduced disclosure framework of FRS I 02 in its next financial 

statements. 

Basis of preparatio11 

The financial statements are prepared under the historical cost convention. 

Fw1ctio11al Cu"e11cy 

The Company's functional currency is USD. All amounts in the financial statements have been rounded to the nearest 

$1,000, except when otherwise indicated. 

Accoulltillg period 

The Company prepared financial statements for either 52 or 53 week periods ending within one week of30 September, 

going forwards accounts will now continue to be prepared to 30 September each year. 

Goi11g co11cer11 

The financial statements have been prepared on a going concern basis which the Directors consider to be appropriate 

given the following considerations. 

Directors considered the operating nature of the entity, including the trading arrangements with affiliated entities and 

expectations for the future trading along with the outstanding inter-company payables and inter-company receivables 

for a period of 12 months from the date of approval of these financial statements which indicate that, taking account 

of reasonably possible downsides, the company will have sufficient funds through funding from its ultimate parent 

Warner Music Group Corp and repayment of outstanding balances from fellow subsidiaries to meet its liabilities as 

they fall due for that period. 

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Notes (continued) 

Accounting policies (co11ti11ued) 

Goi11g co11cer11 (co11ti11ued) 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Those forecasts are dependent on Warner Music Group Corp. not seeking repayment of the amounts currently due to 

the group, at the date of the approval of these financial statements, providing additional financial support during that 

period, and continuing the existing, contracted trading arrangements across the Group. Warner Music Group Corp. 

has indicated its intention to continue to make available such funds as are needed by the company, and that it does not 

intend to seek repayment of the amounts due at the balance sheet date, for the period covered by the forecasts. The 

directors also have no reason to believe that trading arrangements with affiliated entities will materially change in the 

foreseeable future. As with any company placing reliance on other group entities for financial support, the directors 

acknowledge that there can be no certainty that this support will continue although, at the date of approval of these 

financial statements, they have no reason to believe that it will not do so. 

Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities 

as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared 

the financial statements on a going concern basis. 

Related parties 

The Company has taken advantage of the exemption in FRS 102 not to disclose details of transactions between fellow 

wholly-owned group undertakings. 

Foreig11 curre11cy 

Transactions in foreign currencies are translated to the Company's functional currency at the foreign exchange rate 

ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance 

sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Non-monetary 

assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange 

rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated 

at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was 

determined. Foreign exchange differences arising on translation are recognised in the profit and loss account. 

Reve11ue 

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the 

revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is 

recognised: 

Provision of Services: revenue is earned on provision of services pursuant to agreements held with worldwide affiliates 

and is recognised in the period that the relevant services are delivered. 

Royalty license and other income: revenue is recognised based on the contractual arrangements entered into with 

third parties, which allow them to exploit the Group's intellectual property in return for a fee. Where the Group is 

entitled to a fee which is not dependent upon future usage, revenue is recognised when the Group has fulfilled its 

contractual commitments. Where the fees due to the Group are dependent upon usage, revenue is recognised based 

upon that usage. Where no reliable basis is available for estimating such usage, revenue is recognised on a straightline basis over the period of the contract terms, as reported to the Group by third parties. 

Basic ji11a11cial i11strume11ts 

Trade and other debtors I creditors 

Trade and other debtors are recognised initially at transaction price less attributable transaction costs. Trade and other 

creditors are recognised initially at transaction price plus attributable transaction costs. 

Investments in subsidiaries 

Investments in subsidiaries are carried at cost less impairment. 

14 

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Notes (continued) 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

1 Accounting policies (continued) 

Tangiblef,xed assets 

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. 

Depreciation is charged to the profit and loss account on a straight-line basis over the estimated useful lives of each 

part ofan item of tangible fixed assets. The estimated useful lives are as follows: 

• Leasehold improvements 

• Plant and Machinery 

• Furniture and equipment 

• Software Development 

over the estimated useful life of the improvements 

over 3-5 years 

over 5 years 

over 3 years 

Depreciation methods, useful lives and residual values are reviewed if there is an indication of a significant change 

since last annual reporting date in the pattern by which the company expects to consume an asset's future economic 

benefits. 

Pensions 

A defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions into 

a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions 

to defined contribution pension plans are recognised as an expense in the profit and loss account in the periods during 

which services are rendered by employees. 

Interest receivable and Interest payable 

Interest payable and similar charges include interest payable, finance charges on shares classified as liabilities and 

finance leases recognised in profit or loss using the effective interest method, unwinding of the discount on provisions, 

and net foreign exchange losses that are recognised in the profit and loss account (see foreign currency accounting 

policy). 

Other interest receivable and similar income include interest receivable on funds invested and net foreign exchange 

gains. 

Interest income and interest payable are recognised in profit or loss as they accrue, using the effective interest method. 

Dividend income is recognised in the profit and loss account on the date the company's right to receive payments is 

established. Foreign currency gains and losses are reported on a net basis. 

Taxation 

Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss 

account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in 

which case it is recognised.directly in equity or other comprehensive income. 

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted 

or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. 

Deferred tax is provided on timing differences which arise from the inclusion of income and expenses in tax 

assessments in periods different from those in which they are recognised in the financial statements. 

Deferred tax is measured at the tax rate that is expected to apply to the reversal of the related difference, using tax 

rates enacted or substantively enacted at the balance sheet date. Deferred tax balances are not discounted. 

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will 

be recovered against the reversal of deferred tax liabilities or other future taxable profits. 

15 

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Notes (continued) 

2 Turnover 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Turnover represents the amounts derived from the provision of services, royalties receivable and fees for other services 

and is stated net of value added tax. 

Sales by destination were as follows: 

2022 2021 

$000 $000 

United Kingdom 4,025 3,354 

Rest of the World 1,517,689 1,357,989 

Total turnover 1,521,714 1,361,343 

Sales by type were as follows: 

2022 2021 

$000 $000 

Provision of Services 19,779 17,802 

Royalties 1,501,935 1,343,541 

Total Turnover 1,521,714 1,361,343 

3 Operating Profit 

This is stated after charging/(crediting): 

2022 2021 

$000 $000 

Auditor remuneration - Audit of these financial statements 207 191 

Depreciation of tangible fixed assets (note 9) 1,136 1,876 

16 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Notes (continued) 

4 Staff numbers and costs 

5 

2022 2021 

$000 $000 

Wages and salaries 45,177 39,742 

Social Security costs 6,997 6,923 

Other pension costs 1,824 1,401 

Total Staff Costs 53,998 48,066 

The average number of persons employed by the Company (including directors) during the year, was as follows: 

2021 

2022 

Number of employees 342 239 

Directors' remuneration 

2022 2021 

$000 $000 

Directors' emoluments 

Emoluments relating to two directors are disclosed in the accounts of the parent company, WMG Acquisition (UK) 

Ltd. As they provide services to WMG Acquisition (UK) Ltd and multiple subsidiary companies, the group does not 

consider that there is a practicable method to apportion these emoluments. The other Directors do not perform qualifying 

services and therefore no emoluments are disclosed in relation to these Directors. 

17 

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Notes (continued) 

6 Interest receivable and similar income 

Intercompany interest receivable 

Other interest receivable 

7 Interest payable and similar expenses 

Intercompany interest payable 

Other interest payable 

8 Taxation 

a. Total tax expense recognised in the profit and loss account 

Current tax 

UK corporation tax on income for the period 

Adjustments in respect of prior periods 

Overseas tax suffered 

Foreign tax relief/other relief 

Total current tax 

Deferred tax 

Origination/reversal of timing differences 

Impact of change in tax rate 

Adjustment in respect of prior years 

Total deferred tax 

Total tax 

The full tax charge for the year is recognised in the Profit and Loss account. 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

2022 

$000 

10,140 

127 

10,267 

2022 

$000 

2022 

$000 

4,041 

801 

5,906 

(742) 

10,006 

588 

124 

712 

10,718 

432 

432 

2021 

$000 

9,600 

9,600 

2021 

$000 

290 

365 

655 

2021 

$000 

2,974 

315 

5,455 

6,631 

127 

(482) 

(355) 

8,389 

18 

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Notes (continued) 

8 Taxation (continued) 

b. Reconciliation of tax charge 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

The standard rate of current tax for the year based on the UK standard rate of corporation tax is 19% (2021: 

19%). The tax charge for the year differs from the standard rate for the reasons in the reconciliation below: • 

Profit before tax for the year 

Profit multiplied by the standard rate of tax in the UK of 19% (2021: 19%) 

Factors affecting charge: 

Expenses not deductible for tax purposes 

Non taxable income 

Change in tax rate on deferred tax balances 

Effect of tax rates in foreign jurisdictions 

Adjustment to tax charge.in respect of previous periods 

Total tax expense included in profit 

c. Tax rate changes 

2022 2021 

$000 $000 

27,256 21,532 

5,179 4,091 

29 73 

(165) (26) 

124 (482) 

4,750 4,418 

801 315 

10,718 6,343 

An increase in the UK corporation tax rate from 19% to 25% (effective 1 April 2023) was substantively enacted on 

24 May 2021, the UK deferred tax asset as at 30 September 2022 has been calculated based on this rate. This will 

also have a consequential effect on the company's future tax charge. 

19 

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Notes (continued) 

9 Tangible fixed assets 

Leasehold 

improvements 

$000 

Cost 

Balance at 24 September 2021 4,663 

Additions 

Balance at 30 September 2022 4,663 

Depreciation 

Balance at 24 September 2021 (4,663) 

Depreciation charge for the year 

Balance at 30 September 2022 (4,663) 

Net book value 

At 24 September 2021 

At 30 September 2022 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Plant 

Machinery, 

Furniture & Software 

Equipment development Total 

$000 $000 $000 

1,428 38,053 44,144 

2,897 2,897 

1,428 40,950 47,041 

(1,345) (36,231) (42,239) 

(1,136) (1,136) 

(1,345) (37,367) (43,375) 

83 1,822 1,905 

83 3,583 3,666 

20 

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Notes (continued) 

IO Fixed asset investments 

At beginning of year 

At end of year 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

2022 

$000 

166,375 

166,375 

2021 

$000 

166,375 

166,375 

Details of the investments in which the company holds at least 20% of the nominal value of any class of share capital 

are as follows: 

Subsidiary u11dertakings 

Proportio11 of 

Country of voting rights Nature of 

Name of compa11y registratio11 Holdi11g a11d shares held busilless 

Warner Music UK Limited England and Ordinary 100% Record 

Wales shares Company 

WMIS Limited England and Ordinary 100% Service 

Wales Company 

Magnet Records Limited* England and Ordinary Record 

Wales shares 100% company 

Anxious Records Limited* England and "A"&"B" 

Wales Ordinary 100% Dormant 

shares 

China Records Limited* England and "A"&"B" 

Wales Ordinary Record 

shares 100% company 

679 Recordings Limited* England and "A"&"B" 

Wales Ordinary Record 

shares 100% company 

1967 Limited* England and Ordinary Record 

Wales shares 100% company 

Elmlowe Limited* England and "A"&"B" 

Wales Ordinary Record 

shares 100% company 

ADA Global Limited* England and Ordinary 

Wales shares 100% Dormant 

Taffia International Limited* England and Ordinary Record 

Wales shares 50.1% company 

A+E Records Limited* England and Ordinary Record 

Wales shares 100% company 

Comedy Box Limited* England and Ordinary 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Wales shares 100% Dormant 

B Unique Records Limited* England and Ordinary Record 

Wales shares 100% company 

FFRR Records Limited* England and Ordinary Record 

Wales shares 100% company 

Infectious Records Limited* England and Ordinary Record 

Wales shares 100% company 

Funghi Records Limited* England and Ordinary 

Wales shares 100% Dormant 

Laurel Records Limited* England and Ordinary Record 

Wales shares 100% company 

Sharemyplaylists.com Limited* England and Ordinary 

Wales shares 100% Dormant 

Radar Scope Limited England and Ordinary Record 

Wales shares 100% company 

SK Acquisition Ltd England and Ordinary Record 

Wales shares 100% company 

Warner Music Ireland Limited*% Ireland Ordinary Record 

shares 100% company 

Warner Music (Northern Ireland) Ltd*- Northern Ireland Ordinary Record 

shares 100% company 

First Night Records Limited* England and Ordinary Record 

Wales shares 100% company 

Exallshow Limited* England and Ordinary Record 

Wales shares 100% company 

Film27 Limited* England and Ordinary Record 

Wales shares 100% company 

Gingerbread Man Records Limited* England and Ordinary Record 

Wales shares 50% company 

*Held by a subsidiary undertaking. 

All of the investments are in unlisted companies with a registered address of Cannon Place, 78 Cannon Street, London, 

EC4N 6AF. With the exception of: - Warner Music (Northern Ireland) Limited with a registered address of Gordon 

Street Mews, 27-29 Gordon Street, Belfast, BT! 2JL and% Warner Music Ireland Limited with a registered address 

of Riverside One, Sir John Rogerson's Quay Dublin, 2, Ireland. 

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Notes (continued) 

11 Debtors due in less than one year 

Amounts owed by group undertakings 

Trade debtors 

Other debtors 

Deferred tax assets 

Prepayments and accrued income 

Group relief receivable 

12 Creditors due in less than one year 

Trade creditors 

Amounts owed to group undertakings 

Group relief payable 

Taxation and social security 

Corporation tax 

Accruals and other creditors 

13 Deferred tax assets and liabilities 

At beginning of year 

Credit to the profit and loss for the year 

At end of year 

Deferred tax assets are attributable to the following: 

Difference between accumulated depreciation and capital allowances 

Other timing differences 

There are no unused tax losses or unused tax credits. 

Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

2022 

$000 

471,874 

136,409 

7,355 

1,676 

843 

618,157 

2022 

$000 

1,277 

305,606 

4,819 

6,022 

276,488 

594,212 

Deferred 

tax 

$000 

2,388 

(712) 

1,676 

2022 

$_000 

1,260 

416 

1,676 

2021 

$000 

683,909 

135,915 

2,429 

2,388 

818 

6,082 

831,541 

2021 

$000 

1,235 

545,386 

2,762 

10,161 

6,414 

250,990 

816,947 

2021 

$000 

2,152 

236 

2,388 

23 

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Company Registration Number: 02258593 

Annual Report and Financial Statements 

30 September 2022 

Notes (continued) 

14 Capital and reserves 

Share capital 

$ 

Allotted, called up a11dfu/ly paid 

Ordinary shares of£ l each at 24 September 2021. and 30 September 2022 130,520,005 

Share capital - represents the nominal value of shares that have been issued. 

15 Defined contribution plans 

The company operates a defined contribution scheme, the Warner Music pension scheme, for its directors and 

employees. The assets of the scheme are held separately from those of the company, in an independently administered 

fund. The unpaid contributions outstanding at year end included in other Creditors are $255k (2021: $296k). 

16 Ultimate parent company and parent company of larger group 

On 30 September 2022 the company was 100% owned by WMG Global Ventures Limited. 

On 30 September 2022 AI Entertainment Holdings LLC a company incorporated in Delaware in the United States of 

America, was the ultimate parent undertaking. Warner Music Group Corp. was the parent undertaking of the 

smallest and largest group of undertakings of which the company was a member and for which group financial 

statements are drawn up. Copies of Warner Music Group Corp.'s financial statements can be obtained from 1209 

Orange Street, Wilmington, DE 19801, USA. 

17 Post Balance Sheet Events 

There have been no significant post balance sheet events which require adjustment to or a disclosure thereon in these 

financial statements. 

24 

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