Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-39795

RESERVOIR MEDIA, INC.

(Exact name of registrant as specified in its charter)

Delaware		83-3584204
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 Varick Street

Suite 801

New York, New York 10014

(Address of principal executive offices, including zip code)

(212) 675-0541

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value per share (the “Common Stock”)	RSVR	The Nasdaq Stock Market LLC
Warrants to purchase one share of Common Stock, each at an exercise price of $11.50 per share	RSVRW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 26, 2024, there were 65,078,938 shares of Common Stock of Reservoir Media, Inc. issued and outstanding.

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RESERVOIR MEDIA, INC.

FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2024

TABLE OF CONTENTS


Part I. Financial Information		1
Item 1. Financial Statements		1
Condensed Consolidated Statements of (Loss) Income for the Three Months Ended June 30, 2024 and 2023 (unaudited)		1
Condensed Consolidated Statements of Comprehensive (Loss) Income for the Three Months Ended June 30, 2024 and 2023 (unaudited)		2
Condensed Consolidated Balance Sheets as of June 30, 2024 and March 31, 2024 (unaudited)		3
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Three Months Ended June 30, 2024 and 2023 (unaudited)		4
Condensed Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2024 and 2023 (unaudited)		5
Notes to Condensed Consolidated Financial Statements		6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3. Quantitative and Qualitative Disclosures About Market Risk		28
Item 4. Controls and Procedures		28
Part II. Other Information		30
Item 1. Legal Proceedings		30
Item 1A. Risk Factors		30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		30
Item 3. Defaults Upon Senior Securities		30
Item 4. Mine Safety Disclosures		30
Item 5. Other Information		30
Item 6. Exhibits		31
Part III. Signatures		32

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Interim Financial Statements.

RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(In U.S. dollars, except share data)

(Unaudited)


	Three Months Ended June 30,
	2024		2023
Revenues	$	34,316,843	$	31,836,586
Costs and expenses:
Cost of revenue		13,281,116		13,471,597
Amortization and depreciation		6,384,757		6,055,568
Administration expenses		9,689,437		9,164,500
Total costs and expenses		29,355,310		28,691,665

Operating income		4,961,533		3,144,921

Interest expense		(5,059,398)		(4,733,533)
Loss on foreign exchange		(59,463)		(29,936)
(Loss) gain on fair value of swaps		(490,295)		1,845,387
Other (expense) income, net		(99,522)		62
(Loss) income before income taxes		(747,145)		226,901
Income tax (benefit) expense		(293,968)		62,348
Net (loss) income		(453,177)		164,553
Net loss attributable to noncontrolling interests		106,522		112,780
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333

(Loss) earnings per common share (Note 13):
Basic	$	(0.01)	$	—
Diluted	$	(0.01)	$	—

Weighted average common shares outstanding (Note 13):
Basic		64,970,693		64,572,432
Diluted		64,970,693		64,998,544

See accompanying notes to the condensed consolidated financial statements.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In U.S. dollars)

(Unaudited)


	Three Months Ended June 30,
	2024		2023
Net (loss) income	$	(453,177)	$	164,553
Other comprehensive income:
Translation adjustments		34,852		1,139,476
Total comprehensive (loss) income		(418,325)		1,304,029
Comprehensive loss attributable to noncontrolling interests		106,522		112,780
Total comprehensive (loss) income attributable to Reservoir Media, Inc.	$	(311,803)	$	1,416,809

See accompanying notes to the condensed consolidated financial statements.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In U.S. dollars, except share data)

(Unaudited)


	June 30,		March 31,
	2024		2024
Assets
Current assets
Cash and cash equivalents	$	16,358,506	$	18,132,015
Accounts receivable		32,081,489		33,227,382
Current portion of royalty advances		12,917,635		13,248,008
Inventory and prepaid expenses		6,163,776		6,300,915
Total current assets		67,521,406		70,908,320

Intangible assets, net		634,724,872		640,222,000
Equity method and other investments		1,355,019		1,451,924
Royalty advances, net of current portion and reserves		50,747,131		56,527,557
Property, plant and equipment, net		520,220		551,410
Operating lease right of use assets, net		6,736,634		6,988,340
Fair value of swap assets		5,141,819		5,753,488
Other assets		1,410,949		1,131,529
Total assets	$	768,158,050	$	783,534,568

Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	5,123,049	$	9,015,939
Royalties payable		38,656,663		40,395,205
Accrued payroll		883,248		2,043,772
Deferred revenue		1,102,261		1,163,953
Other current liabilities		6,371,704		7,313,615
Income taxes payable		541,503		439,152
Total current liabilities		52,678,428		60,371,636

Secured line of credit		324,127,393		330,791,607
Deferred income taxes		30,028,349		30,471,978
Operating lease liabilities, net of current portion		6,431,339		6,720,287
Fair value of swap liability		—		121,374
Other liabilities		469,589		572,705
Total liabilities		413,735,098		429,049,587

Contingencies and commitments (Note 15)

Shareholders’ Equity
Preferred stock, $0.0001 par value 75,000,000 shares authorized, 0 shares issued and outstanding at June 30, 2024 and March 31, 2024		—		—
Common stock, $0.0001 par value; 750,000,000 shares authorized, 65,078,938 shares issued and outstanding at June 30, 2024; 64,826,864 shares issued and outstanding at March 31, 2024		6,508		6,483
Additional paid-in capital		341,744,622		341,388,351
Retained earnings		15,051,002		15,397,657
Accumulated other comprehensive loss		(3,762,881)		(3,797,733)
Total Reservoir Media, Inc. shareholders’ equity		353,039,251		352,994,758
Noncontrolling interest		1,383,701		1,490,223
Total shareholders’ equity		354,422,952		354,484,981
Total liabilities and shareholders’ equity	$	768,158,050	$	783,534,568

See accompanying notes to the condensed consolidated financial statements.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(In U.S. dollars, except share data)

(Unaudited)


	For the Three Months Ended June 30, 2024
	Common Stock							Accumulated other
				Additional paid-in		Retained		comprehensive		Noncontrolling		Shareholders’
	Shares	Amount		capital		earnings		loss		interests		equity
Balance, March 31, 2024	64,826,864	$	6,483	$	341,388,351	$	15,397,657	$	(3,797,733)	$	1,490,223	$	354,484,981
Share-based compensation	—		—		1,048,520		—		—		—		1,048,520
Stock option exercises	3,550		—		18,140								18,140
Vesting of restricted stock units, net of shares withheld for employee taxes	248,524		25		(1,432,889)		—		—		—		(1,432,864)
Reclassification of liability-classified awards to equity-classified awards	—		—		722,500		—		—		—		722,500
Net loss	—		—		—		(346,655)		—		(106,522)		(453,177)
Other comprehensive income	—		—		—		—		34,852		—		34,852
Balance, June 30, 2024	65,078,938	$	6,508	$	341,744,622	$	15,051,002	$	(3,762,881)	$	1,383,701	$	354,422,952


	For the Three Months Ended June 30, 2023
	Common Stock							Accumulated other
				Additional paid-in		Retained		comprehensive		Noncontrolling		Shareholders’
	Shares	Amount		capital		earnings		loss		interests		equity
Balance, March 31, 2023	64,441,244	$	6,444	$	338,460,789	$	14,752,720	$	(4,855,329)	$	1,297,899	$	349,662,523
Share-based compensation	—		—		713,802		—		—		—		713,802
Vesting of restricted stock units, net of shares withheld for employee taxes	207,733		21		(689,176)		—		—		—		(689,155)
Reclassification of liability-classified awards to equity-classified awards	—		—		664,167		—		—		—		664,167
Net income (loss)	—		—		—		277,333		—		(112,780)		164,553
Other comprehensive income	—		—		—		—		1,139,476		—		1,139,476
Balance, June 30, 2023	64,648,977	$	6,465	$	339,149,582	$	15,030,053	$	(3,715,853)	$	1,185,119	$	351,655,366

See accompanying notes to the condensed consolidated financial statements.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. dollars)

(Unaudited)


	Three Months Ended June 30,
	2024		2023
Cash flows from operating activities:
Net (loss) income	$	(453,177)	$	164,553
Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities:
Amortization of intangible assets		6,326,863		5,997,512
Depreciation of property, plant and equipment		57,894		58,056
Share-based compensation		1,273,674		914,426
Amortization of deferred financing costs		335,786		334,121
Loss (gain) on fair value of swaps		490,295		(1,845,387)
Loss from equity affiliates		100,000		—
Deferred income taxes		(446,780)		—
Changes in operating assets and liabilities:
Accounts receivable		1,145,893		(759,449)
Inventory and prepaid expenses		137,139		369,841
Royalty advances		6,121,523		(2,960,260)
Other assets and liabilities		(100,897)		188,150
Accounts payable, accrued expenses and deferred revenue		(4,796,318)		(3,323,134)
Royalties payable		(1,738,542)		(9,520)
Income taxes payable		102,351		9,754
Net cash provided by (used for) operating activities		8,555,704		(861,337)

Cash flows from investing activities:
Purchases of music catalogs		(1,871,957)		(15,134,924)
Purchase of property, plant and equipment		(26,704)		(91,660)
Net cash used for investing activities		(1,898,661)		(15,226,584)

Cash flows from financing activities:
Proceeds from secured line of credit		3,000,000		14,000,000
Repayments of secured line of credit		(10,000,000)		—
Proceeds from stock option exercises		18,140		—
Taxes paid related to net share settlement of restricted stock units		(1,432,864)		(689,155)
Deferred financing costs paid		—		(16,904)
Net cash (used for) provided by financing activities		(8,414,724)		13,293,941

Foreign exchange impact on cash		(15,828)		142,000

Decrease in cash and cash equivalents		(1,773,509)		(2,651,980)
Cash and cash equivalents beginning of period		18,132,015		14,902,076
Cash and cash equivalents end of period	$	16,358,506	$	12,250,096

See accompanying notes to the condensed consolidated financial statements.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

NOTE 1. DESCRIPTION OF BUSINESS

Reservoir Media, Inc., a Delaware corporation (the “Company”), is an independent music company based in New York City, New York and with offices in Los Angeles, Nashville, Toronto, London and Abu Dhabi.

Following a business combination between Roth CH Acquisition II Co. (“ROCC”) and Reservoir Holdings, Inc., a Delaware corporation (“RHI”), on July 28, 2021 (the “Business Combination”), the Company’s legal name became “Reservoir Media, Inc.” The common stock, $0.0001 par value per share, of the Company (the “Common Stock”) and warrants are traded on The Nasdaq Stock Market LLC (“NASDAQ”) under the ticker symbols “RSVR” and “RSVRW,” respectively.

The Company is a holding company that conducts substantially all of its business operations through a subsidiary of RHI, Reservoir Media Management, Inc. (“RMM”), and RMM’s subsidiaries The Company’s activities are organized into two operating segments: Music Publishing and Recorded Music. Operations of the Music Publishing segment involve the acquisition of interests in music catalogs from which royalties are earned as well as signing songwriters to exclusive agreements which give the Company an interest in the future delivery of songs. The publishing catalog includes ownership or control rights to more than 150,000 musical compositions that span across historic pieces, motion picture scores and current award-winning hits. Operations of the Recorded Music segment include the ownership of over 36,000 sound recordings and involve the acquisition of sound recording catalogs as well as the discovery and development of recording artists and the marketing, distribution, sale and licensing of the music catalog.

NOTE 2. BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiaries and have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. All intercompany transactions and balances have been eliminated in these condensed consolidated financial statements. Certain information and note disclosures typically included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s audited financial statements as of and for the fiscal years ended March 31, 2024 and 2023.

The condensed consolidated balance sheet of the Company as of March 31, 2024, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures, including certain notes required by US GAAP on an annual reporting basis.

In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations and cash flows for the interim periods. The results for the three months ended June 30, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, the fiscal year ending March 31, 2025 or any other period.

The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. Significant estimates are used for, but not limited to, determining useful lives of intangible assets, intangible asset recoverability and impairment and accrued revenue. Actual results could differ from these estimates.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Standards Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which expands income tax disclosures, including requiring enhanced disclosures related to the rate reconciliation and income taxes paid information. The amendments in ASU 2023-09 should be applied on a prospective basis, with retrospective application permitted. ASU 2023-09 is effective for annual periods of public business entities for fiscal years beginning after December 15, 2024 and for annual periods of entities other than public entities beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the impact that adoption of ASU 2023-09 will have on its disclosures upon adoption.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which expands segment disclosures for public entities, including requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”), the title and position of the CODM and an explanation of how the CODM uses reported measures of segment profit or loss in assessing segment performance and allocating resources. ASU 2023-07 also expands disclosures about a reportable segment’s profit or loss and assets in interim periods and clarifies that a public entity may report additional measures of segment profit if the CODM uses more than one measure of a segment’s profit or loss. ASU 2023-07 does not remove existing segment disclosure requirements or change how a public entity identifies its operating segments, aggregates those operating segments, or determines its reportable segments. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 with early adoption permitted, and requires retrospective application to all prior periods presented in the financial statements. The Company is currently evaluating the impact that adoption of ASU 2023-07 will have on its disclosures upon adoption.

NOTE 4. REVENUE RECOGNITION

For the Company’s operating segments, Music Publishing and Recorded Music, the Company accounts for a contract when it has legally enforceable rights and obligations and collectability of consideration is probable. The Company identifies the performance obligations and determines the transaction price associated with the contract. Revenue is recognized when, or as, control of the promised services or goods is transferred to the Company’s customers, and in an amount that reflects the consideration the Company is contractually due in exchange for those services or goods. Certain of the Company’s arrangements include licenses of intellectual property with consideration in the form of sales- and usage-based royalties. Royalty revenue is recognized when the subsequent sale or usage occurs using the best estimates available of the amounts that will be received by the Company. The Company recognized revenue of $1,163,855 and $1,295,141 from performance obligations satisfied in previous periods for the three months ended June 30, 2024 and 2023, respectively.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

Disaggregation of Revenue

The Company’s revenue consisted of the following categories during the three months ended June 30, 2024 and 2023:


	Three Months Ended June 30,
	2024		2023
Revenue by Type
Digital	$	14,634,703	$	11,900,517
Performance		5,134,426		4,514,904
Synchronization		2,811,017		3,032,699
Mechanical		668,973		559,647
Other		751,174		783,548
Total Music Publishing		24,000,293		20,791,315

Digital		6,558,170		5,622,649
Physical		1,352,341		3,574,551
Neighboring rights		1,106,350		859,147
Synchronization		613,643		328,290
Total Recorded Music		9,630,504		10,384,637

Other revenue	$	686,046		660,634
Total revenue	$	34,316,843	$	31,836,586


	Three Months Ended June 30,
	2024		2023
Revenue by Geographical Location
United States Music Publishing	$	13,789,192	$	13,000,994
United States Recorded Music		5,696,630		5,524,763
United States other revenue		686,046		660,634
Total United States		20,171,868		19,186,391
International Music Publishing		10,211,101		7,790,321
International Recorded Music		3,933,874		4,859,874
Total International		14,144,975		12,650,195
Total revenue	$	34,316,843	$	31,836,586

Only the United States represented 10% or more of the Company’s total revenues in the three months ended June 30, 2024 and 2023.

Deferred Revenue

The following table reflects the change in deferred revenue during the three months ended June 30, 2024 and 2023:


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	1,163,953	$	2,151,889
Cash received during period		933,713		493,290
Revenue recognized during period		(995,405)		(1,189,250)
Balance at end of period	$	1,102,261	$	1,455,929

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

NOTE 5. ACQUISITIONS

In the ordinary course of business, the Company regularly acquires publishing and recorded music catalogs, which are typically accounted for as asset acquisitions. During the three months ended June 30, 2024 and 2023, the Company completed such acquisitions totaling $801,315 and $15,623,951, respectively, inclusive of deferred acquisition payments, none of which were individually significant.

NOTE 6. INTANGIBLE ASSETS

Intangible assets subject to amortization consist of the following as of June 30, 2024 and March 31, 2024:


	June 30, 2024		March 31, 2024
Intangible assets subject to amortization:
Publishing and recorded music catalogs	$	770,493,046	$	769,648,966
Artist management contracts		913,272		911,740
Gross intangible assets		771,406,318		770,560,706
Accumulated amortization		(136,681,446)		(130,338,706)
Intangible assets, net	$	634,724,872	$	640,222,000

Straight-line amortization expense totaled $6,326,863 and $5,997,512 in the three months ended June 30, 2024 and 2023, respectively.

NOTE 7. ROYALTY ADVANCES

The Company made royalty advances totaling $2,396,796 and $6,199,316 during the three months ended June 30, 2024 and 2023, respectively, recoupable from the writer’s or artist’s share of future royalties otherwise payable, in varying amounts. Advances expected to be recouped within the next twelve months are classified as current assets, with the remainder classified as noncurrent assets, net of reserves for amounts that may not be recoverable.

The following table reflects the change in royalty advances, net during the three months ended June 30, 2024 and 2023:


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	69,775,565	$	66,926,500
Additions		2,396,796		6,199,316
Recoupments		(8,507,595)		(3,239,056)
Balance at end of period	$	63,664,766	$	69,886,760

NOTE 8. SECURED LINE OF CREDIT

Long-term debt consists of the following:


	June 30, 2024		March 31, 2024
Secured line of credit	$	328,828,409	$	335,828,410
Debt issuance costs, net		(4,701,016)		(5,036,803)
	$	324,127,393	$	330,791,607

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

Credit Facilities

RMM is party to a credit agreement (as amended or supplemented from time to time, the “RMM Credit Agreement”) governing RMM’s $450,000,000 senior secured revolving credit facility (the “Senior Credit Facility”). The Senior Credit Facility also includes an “accordion feature” that permits RMM to seek additional commitments in an amount not to exceed $150,000,000. The maturity date of the loans advanced under the Senior Credit Facility is December 16, 2027.

The interest rate on borrowings under the Senior Credit Facility is equal to, at our option, either (i) the sum of a base rate plus a margin of 1.00% or (ii) the sum of a SOFR rate plus a margin of 2.00%, in each case subject to a 0.25% increase based on a consolidated net senior debt to library value ratio. RMM is also required to pay an unused fee in respect of unused commitments under the Senior Credit Facility, if any, at a rate of 0.25% per annum. Substantially all tangible and intangible assets of the Company, RHI, RMM and the other subsidiary guarantors are pledged as collateral to secure the obligations of RMM under the RMM Credit Agreement.

The RMM Credit Agreement contains customary covenants limiting the ability of the Company, RHI, RMM and certain of its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, make investments, make cash dividends, redeem or repurchase capital stock, dispose of assets, enter into transactions with affiliates or enter into certain restrictive agreements. In addition, the Company, on a consolidated basis with its subsidiaries, must comply with financial covenants requiring the Company to maintain (i) a fixed charge coverage ratio of not less than 1.10:1.00 for each four fiscal quarter period, and (ii) a consolidated senior debt to library value ratio of 0.45:1.00, subject to certain adjustments. If RMM does not comply with the covenants in the RMM Credit Agreement, the lenders may, subject to customary cure rights, require the immediate payment of all amounts outstanding under the Senior Credit Facility.

As of June 30, 2024, the Senior Credit Facility had a borrowing capacity of $450,000,000, with remaining borrowing availability of $121,171,591.

Interest Rate Swaps

At June 30, 2024, RMM had the following interest rate swaps outstanding, under which it pays a fixed rate and receives a floating interest payment from the counterparty based on SOFR with reference to notional amounts adjusted to match the amended scheduled principal repayments pursuant to the Senior Credit Facility:


	Notional		Pay
	Amount at		Fixed
Effective Date	June 30, 2024		Rate		Maturity
March 10, 2022	$	7,625,000	1.533	%	September 2024
March 10, 2022	$	87,501,612	1.422	%	September 2024
December 31, 2021	$	54,873,388	0.972	%	September 2024
September 30, 2024	$	100,000,000	2.946	%	December 2027
September 30, 2024	$	50,000,000	3.961	%	December 2027

NOTE 9. INCOME TAXES

Income tax (benefit) expense for the three months ended June 30, 2024 and 2023 was $(293,968) (39.3% effective tax rate) and $62,348 (27.5% effective tax rate), respectively. During the three months ended June 30, 2024, the Company recorded an incremental tax benefit of approximately $103,000 to its deferred tax liabilities related to certain international intangible assets. Additionally, the effective tax rates during these periods reflect the amount and mix of income from multiple tax jurisdictions.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

NOTE 10. SUPPLEMENTARY CASH FLOW INFORMATION

Interest paid and income taxes paid for the three months ended June 30, 2024 and 2023 were comprised of the following:


	2024		2023
Interest paid	$	4,842,444	$	4,333,987
Income taxes paid	$	44,212	$	58,157

Non-cash investing and financing activities for the three months ended June 30, 2024 and 2023 were comprised of the following:


	2024		2023
Acquired intangible assets included in other liabilities	$	—	$	1,355,000
Reclassification of liability-classified awards to equity-classified awards	$	722,500	$	664,167

NOTE 11. WARRANTS

As of June 30, 2024, the Company’s outstanding warrants included 5,750,000 publicly-traded warrants (the “Public Warrants”), which were issued during ROCC’s initial public offering on December 15, 2020, and 137,500 warrants sold in a private placement to ROCC’s sponsor (the “Private Warrants” and together with the Public Warrants, the “Warrants”), which were assumed by the Company in connection with the Business Combination and exchanged into warrants for shares of Common Stock. Each whole Warrant entitles the registered holder to purchase one whole share of Common Stock at a price of $11.50 per share, provided that the Company has an effective registration statement under the Securities Act covering the shares of Common Stock issuable upon exercise of the Warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder.

The Warrants will expire on July 28, 2026, which is five years after the completion of the Business Combination, or earlier upon redemption or liquidation. The Company may redeem the outstanding Public Warrants in whole, but not in part, at a price of $0.01 per warrant upon a minimum of 30 days’ prior written notice of redemption, if and only if the last sale price of Common Stock equals or exceeds $18.00 per share for any 20-trading days within a 30-trading day period ending three business days before the Company sends the notice of redemption to the registered holders.

NOTE 12. SHARE-BASED COMPENSATION

Share-based compensation expense totaled $1,273,674 ($990,251, net of taxes) and $914,426 ($704,234, net of taxes) during the three months ended June 30, 2024 and 2023, respectively. Share-based compensation expense is classified as “Administration expenses” in the accompanying condensed consolidated statements of income.

During the three months ended June 30, 2024 and 2023, the Company granted restricted stock units (“RSUs”) to satisfy previous obligations to issue a variable number of equity awards based on a fixed monetary amount. Prior to the issuance of these RSUs, the Company classified these awards as liabilities. Upon issuance of the RSU’s the awards became equity-classified as they no longer met the criteria to be liability-classified and as a result liabilities of $722,500 and $664,167 were reclassified from accounts payable and accrued liabilities to additional paid-in capital during the three months ended June 30, 2024 and 2023, respectively.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

NOTE 13. (LOSS) EARNINGS PER SHARE

The following table summarizes the basic and diluted (loss) earnings per common share calculation for the three months ended June 30, 2024 and 2023:


		Three Months Ended
		June 30,
		2024	2023

Basic (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
(Loss) earnings per common share - basic	$	(0.01)	$	—

Diluted (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
Weighted average effect of potentially dilutive securities:
Effect of dilutive stock options and RSUs		—		426,112
Weighted average common shares outstanding - diluted		64,970,693		64,998,544
(Loss) earnings per common share - diluted	$	(0.01)	$	—

Because of their anti-dilutive effect, 7,799,897 shares of Common Stock equivalents, comprised of 1,277,332 stock options, 635,065 RSUs and 5,887,500 warrants have been excluded from the diluted earnings per share calculation for the three months ended June 30, 2024. Because of their anti-dilutive effect, 5,953,199 shares of Common Stock equivalents, comprised of 65,699 RSUs and 5,887,500 warrants have been excluded from the diluted earnings per share calculation for the three months ended June 30, 2023.

NOTE 14. FINANCIAL INSTRUMENTS

The Company is exposed to the following risks related to its financial instruments:

(a)

Credit Risk

Credit risk arises from the possibility that the Company’s debtors may be unable to fulfill their financial obligations. Revenues earned from publishing and distribution companies are concentrated in the music and entertainment industry. The Company monitors its exposure to credit risk on a regular basis.

(b)

Interest Rate Risk

The Company is exposed to market risk from changes in interest rates on its Senior Credit Facility. As described in Note 8, “Secured Line of Credit,” the Company entered into interest rate swap agreements to partially reduce its exposure to fluctuations in interest rates on its Credit Facilities.

The fair value of the outstanding interest rate swaps consisted of a $5,141,819 asset as of June 30, 2024 and a $5,753,488 asset and a $121,374 liability at March 31, 2024. Fair value is determined using Level 2 inputs, which are based on quoted prices and market observable data of similar instruments. The change in the unrealized fair value of the swaps during the three months ended June 30, 2024 of $490,295 was recorded as a Loss on fair value of swaps. The change in the unrealized fair value of the swaps during the three months ended June 30, 2023 of $1,845,387 was recorded as a Gain on fair value of swaps.

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)

(c)

Foreign Exchange Risk

The Company is exposed to foreign exchange risk in fluctuations of currency rates on its revenue from royalties, writers’ fees and its subsidiaries’ operations.

(d)

Financial Instruments

Financial instruments not described elsewhere include cash, accounts receivable, accounts payable, accrued liabilities and the Company’s secured line of credit. The carrying values of these instruments as of June 30, 2024 do not differ materially from their respective fair values due to the immediate or short-term duration of these items or their bearing market-related rates of interest.

NOTE 15. CONTINGENCIES AND COMMITMENTS

(a)

Litigation

The Company is subject to claims and contingencies in the normal course of business. To the extent the Company cannot predict the outcome of the claims and contingencies or estimate the amount of any loss that may result, no provision for any contingent liabilities has been made in the condensed consolidated financial statements. The Company believes that losses resulting from these matters, if any, would not have a material adverse effect on the financial position, results of operations or cash flows of the Company. All such matters which the Company concludes are probable to result in a loss and for which management can reasonably estimate the amount of such loss have been accrued for within these condensed consolidated financial statements.

NOTE 16. SEGMENT REPORTING

The Company’s business is organized in two reportable segments: Music Publishing and Recorded Music. The Company identified its Chief Executive Officer as its Chief Operating Decision Maker (“CODM”). The Company’s CODM evaluates financial performance of its segments based on several factors, of which the primary financial measure is operating income before depreciation and amortization (“OIBDA”). The accounting policies of the Company’s business segments are consistent with the Company’s policies for the condensed consolidated financial statements. The Company does not have sales between segments.

The following tables present total revenue and reconciliation of OIBDA to operating income by segment for the three months ended June 30, 2024 and 2023:


	Three Months Ended June 30, 2024
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	24,000,293	$	9,630,504	$	686,046	$	34,316,843

Reconciliation of OIBDA to operating income:
Operating income		2,182,422		2,691,278		87,833		4,961,533
Amortization and depreciation		4,601,128		1,759,822		23,807		6,384,757
OIBDA	$	6,783,550	$	4,451,100	$	111,640	$	11,346,290

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RESERVOIR MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

(Unaudited)


	Three Months Ended June 30, 2023
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	20,791,315	$	10,384,637	$	660,634	$	31,836,586

Reconciliation of OIBDA to operating income (loss):
Operating income (loss)		1,396,472		1,763,796		(15,347)		3,144,921
Amortization and depreciation		4,302,844		1,729,152		23,572		6,055,568
OIBDA	$	5,699,316	$	3,492,948	$	8,225	$	9,200,489

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of Reservoir Media, Inc.’s financial condition and results of operations should be read in conjunction with Reservoir Media, Inc.’s condensed consolidated financial statements, including the accompanying notes thereto contained elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”). Certain statements contained in the discussion and analysis set forth below include forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. Unless the context otherwise requires, the terms “we,” “us,” “our,” the “Company” and “Reservoir” refer collectively to Reservoir Media, Inc. and its consolidated subsidiaries.

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are not historical facts, and are intended to be covered by the safe harbor created thereby. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “predict,” “project,” “target,” “goal,” “intend,” “continue,” “could,” “may,” “might,” “shall,” “should,” “will,” “would,” “plan,” “possible,” “potential,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. In addition, any statements that refer to expectations, projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current expectations, projections and beliefs based on information currently available. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about the Company that may cause its actual business, financial condition, results of operations, performance and/or achievements to be materially different from any future business, financial condition, results of operations, performance and/or achievements expressed or implied by these forward-looking statements. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described under “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K (the “Annual Report”) filed with the U.S. Securities and Exchange Commission (the “SEC”) on May 30, 2024 and the Company’s other filings with the SEC. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Introduction

We are a holding company that conducts substantially all of our business operations through Reservoir Media Management, Inc. (“RMM”) and RMM’s subsidiaries. Our activities are generally organized into two operating segments: Music Publishing and Recorded Music. Operations of the Music Publishing segment involve the acquisition of interests in music catalogs from which royalties are earned as well as signing songwriters to exclusive agreements, which gives us an interest in the future delivery of songs. Operations of the Recorded Music segment involve the acquisition of sound recording catalogs as well as the discovery and development of recording artists and the marketing, distribution, sale and licensing of the music catalogs.

Business Overview

We are an independent music company operating in music publishing and recorded music. We represent over 150,000 copyrights in our publishing business and over 36,000 master recordings in our recorded music business. Both of our business areas are populated with hit songs dating back to the early 1900s representing an array of artists across genre and geography. Consistent with how we classify and operate our business, our company is organized in two operating and reportable segments: Music Publishing and Recorded Music. A brief description of each segment’s operations is presented below.

Music Publishing Segment

Music Publishing is an intellectual property business focused on generating revenue from uses of the musical composition itself. In return for promoting, placing, marketing and administering the creative output of a songwriter or engaging in those activities for other rightsholders, our Music Publishing business garners a share of the revenues generated from use of the musical compositions.

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The operations of our Music Publishing business are conducted principally through RMM, our global music publishing company headquartered in New York City, with operations in multiple countries through various subsidiaries, affiliates and non-affiliated licensees and sub-publishers. We own or control rights to more than 150,000 musical compositions, including numerous pop hits, American standards, folk songs and motion picture and theatrical compositions. Assembled over many years, our current award-winning active songwriters exceed 100, while the catalog includes over 5,000 clients representing a diverse range of genres, including pop, rock, jazz, classical, country, R&B, hip-hop, rap, reggae, Latin, folk, blues, symphonic, soul, Broadway, techno, alternative and gospel.

Music Publishing revenues are derived from five main sources:

●

Digital––the rightsholder receives revenues with respect to musical compositions embodied in recordings distributed in streaming services, download services and other digital music services;

●

Performance––the rightsholder receives revenues if the musical composition is performed publicly through broadcast of music on television, radio and cable and in retail locations (e.g., bars and restaurants), live performance at a concert or other venue (e.g., arena concerts and nightclubs), and performance of music in staged theatrical productions;

●

Synchronization––the rightsholder receives revenues for the right to use the musical composition in combination with visual images such as in films or television programs, television commercials and video games;

●

Mechanical––the rightsholder receives revenues with respect to musical compositions embodied in recordings sold in any machine-readable format or configuration such as vinyl, CDs and DVDs; and

●

Other––the rightsholder receives revenues for use in sheet music and other uses.

The principal costs associated with our Music Publishing business are as follows:

●

Writer Royalties and Other Publishing Costs––the artist and repertoire (“A&R”) costs associated with (i) paying royalties to songwriters, co-publishers and other copyright holders in connection with income generated from the uses of their works and (ii) signing and developing songwriters; and

●

Administration Expenses––the costs associated with general overhead, and other administrative expenses, as well as selling and marketing.

Recorded Music Segment

Our Recorded Music business consists of three primary areas of sound recording ownership. First is the active marketing, promotion, distribution, sale and licensing of newly created frontline sound recordings from Current Artists that we own and control. This is a new area of focus for us and does not yet produce significant revenue. The second is the active marketing, promotion, distribution, sale and license of previously recorded and subsequently acquired Catalog recordings. The third is acquisition of full or partial interests in existing record labels, sound recording catalogs or income rights to a royalty stream associated with an established recording artist or producer contract in connection with existing sound recordings. Acquisition of these income participation interests are typically in connection with recordings that are owned, controlled, and marketed by other record labels.

Our Current Artist and Catalog recorded music businesses are both primarily handled by our Chrysalis Records label based in London and our Tommy Boy record label based in New York City. We also manage some select Catalog recorded music under our Philly Groove Records and Reservoir Records labels. We also own income participation interests in recordings by The Isley Brothers, The Commodores, Wisin and Yandel, Alabama and Travis Tritt, and an interest in the Loud Records catalog containing recordings by the Wu-Tang Clan. Our core Catalog includes recordings under the Chrysalis Records label by artists such as Sinéad O’Connor, The Specials, Generation X and The Waterboys, and De La Soul, as well as recordings under the Tommy Boy record label by artists such as House of Pain, Naughty By Nature, and Queen Latifah.

Our Current Artist and Catalog recorded music distribution is handled by a network of distribution partners. Chrysalis Records current frontline releases are distributed through Secretly Distribution, with prior frontline releases distributed via PIAS. Chrysalis Records and Tommy Boy catalogs are distributed via our agreements with MERLIN, AMPED, Proper and other partners.

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Through our distribution network, our music is being sold in physical retail outlets as well as in physical form to online physical retailers, such as amazon.com, and distributed in digital form to an expanding universe of digital partners, including streaming services such as Amazon, Apple, Deezer, SoundCloud, Spotify, Tencent Music Entertainment Group and YouTube, radio services such as iHeart Radio and SiriusXM, and download services. We also license music digitally to fitness platforms such as Apple Fitness+, Equinox, Hydrow and Peloton and social media outlets, such as Facebook, Instagram, TikTok and Snap.

Recorded Music revenues are derived from four main sources:

●

Digital––the rightsholder receives revenues with respect to streaming and download services;

●

Physical––the rightsholder receives revenues with respect to sales of physical products such as vinyl, CDs and DVDs;

●

Neighboring Rights––the rightsholder receives royalties if sound recordings are performed publicly through broadcast of music on television, radio, and cable, and in public spaces such as shops, workplaces, restaurants, bars and clubs; and

●

Synchronization––the rightsholder receives royalties or fees for the right to use sound recordings in combination with visual images such as in films or television programs, television commercials and video games.

The principal costs associated with our Recorded Music business are as follows:

●

Artist Royalties and Other Recorded Costs––the A&R costs associated with (i) paying royalties to recording artists, producers, songwriters, other copyright holders and trade unions, (ii) signing and developing recording artists and (iii) creating master recordings in the studio; and product costs to manufacture, package and distribute products to wholesale and retail distribution outlets; and

●

Administration Expenses––the costs associated with general overhead and other administrative expenses as well as costs associated of selling and marketing.

Use of Non-GAAP Financial Measures

We prepare our financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP” or “GAAP”). However, this Management’s Discussion and Analysis of Financial Condition and Results of Operations also contains certain non-GAAP financial measures to assist readers in understanding our performance. Non-GAAP financial measures either exclude or include amounts that are not reflected in the most directly comparable measure calculated and presented in accordance with GAAP. Where non-GAAP financial measures are used, we have provided the most directly comparable measures calculated and presented in accordance with U.S. GAAP, a reconciliation to GAAP measures and a discussion of the reasons why management believes this information is useful to it and may be useful to investors.

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Results of Operations

Income Statement

Our income statement was composed of the following amounts (in thousands):


	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Revenues	$	34,317	$	31,837	$	2,480	8	%
Costs and expenses:
Cost of revenue		13,281		13,472		(190)	(1)	%
Amortization and depreciation		6,385		6,056		329	5	%
Administration expenses		9,689		9,165		525	6	%
Total costs and expenses		29,355		28,692		664	2	%

Operating income		4,962		3,145		1,817	58	%

Interest expense		(5,059)		(4,734)		(326)	7	%
Loss on foreign exchange		(59)		(30)		(30)	99	%
(Loss) gain on fair value of swaps		(490)		1,845		(2,336)	(127)	%
Other (expense) income, net		(100)		—		(100)	NM
(Loss) income before income taxes		(747)		227		(974)	NM
Income tax (benefit) expense		(294)		62		(356)	NM
Net (loss) income		(453)		164		(618)	NM
Net loss attributable to noncontrolling interests		107		113		(6)	(6)	%
Net (loss) income attributable to Reservoir Media, Inc.	$	(347)	$	277	$	(624)	NM

NM – Not meaningful

Revenues

Our revenues were composed of the following amounts (in thousands):


	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Revenue by Type
Digital	$	14,635	$	11,901	$	2,734	23	%
Performance		5,134		4,515		620	14	%
Synchronization		2,811		3,033		(222)	(7)	%
Mechanical		669		560		109	20	%
Other		751		784		(32)	(4)	%
Total Music Publishing		24,000		20,791		3,209	15	%

Digital		6,558		5,623		936	17	%
Physical		1,352		3,575		(2,222)	(62)	%
Neighboring rights		1,106		859		247	29	%
Synchronization		614		328		285	87	%
Total Recorded Music		9,631		10,385		(754)	(7)	%

Other revenue		686		661		25	4	%
Total Revenue	$	34,317	$	31,837	$	2,480	8	%

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	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Revenue by Geographical Location
U.S. Music Publishing	$	13,789	$	13,001	$	788	6	%
U.S. Recorded Music		5,697		5,525		172	3	%
U.S. Other Revenue		686		661		25	4	%
Total U.S.		20,172		19,186		985	5	%
International Music Publishing		10,211		7,790		2,421	31	%
International Recorded Music		3,934		4,860		(926)	(19)	%
Total International		14,145		12,650		1,495	12	%
Total Revenue	$	34,317	$	31,837	$	2,480	8	%

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Total revenues increased by $2,480 thousand, or 8%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, driven by a 15% increase in Music Publishing revenue, partially offset by a 7% decrease in Recorded Music revenue. Music Publishing revenues represented 70% and 65% of total revenues for the three months ended June 30, 2024 and the three months ended June 30, 2023, respectively. Recorded Music revenues represented 28% and 33% of total revenues for the three months ended June 30, 2024 and the three months ended June 30, 2023, respectively. U.S. and international revenues represented 59% and 41%, respectively, of total revenues for the three months ended June 30, 2024. U.S. and international revenues represented 60% and 40%, respectively, of total revenues for the three months ended June 30, 2023.

Total digital revenues increased by $3,670 thousand, or 21%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, primarily due to price increases at multiple music streaming services, as well as the impact of catalog acquisitions. Total digital revenues represented 62% and 55% of consolidated revenues for the three months ended June 30, 2024 and the three months ended June 30, 2023, respectively.

Music Publishing revenues increased by $3,209 thousand, or 15%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. This increase in Music Publishing revenue was mainly driven by acquisitions of catalogs and revenue from the existing catalog, which benefitted from price increases at multiple music streaming services, and led to increases in digital revenue, performance revenue and mechanical revenue, partially offset by decreases in synchronization revenue and other revenue.

On a geographic basis, U.S. Music Publishing revenues represented 57% of total Music Publishing revenues for the three months ended June 30, 2024 compared to 63% for the three months ended June 30, 2023. International Music Publishing revenues represented 43% of total Music Publishing revenues for the three months ended June 30, 2024 compared to 37% for the three months ended June 30, 2023.

Recorded Music revenues decreased by $754 thousand, or 7%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in Recorded Music revenue was driven by a $2,222 thousand decrease in physical revenue, primarily due to 2023 De La Soul releases. The decrease in physical revenue was partially offset by continued growth at music streaming services and price increases at multiple music streaming services, as well as increases in neighboring rights revenue and synchronization revenue.

On a geographic basis, U.S. Recorded Music revenues represented 59% of total Recorded Music revenues for the three months ended June 30, 2024 compared to 53% for the three months ended June 30, 2023. International Recorded Music revenues represented 41% of total Recorded Music revenues for the three months ended June 30, 2024 compared to 47% for the three months ended June 30, 2023.

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Cost of Revenues

Our cost of revenues was composed of the following amounts (in thousands):


	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Writer royalties and other publishing costs	$	10,635	$	9,505	$	1,130	12	%
Artist royalties and other recorded music costs		2,646		3,967		(1,321)	(33)	%
Total cost of revenue	$	13,281	$	13,472	$	(191)	(1)	%

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Cost of revenues decreased by $191 thousand, or 1%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Cost of revenues as a percentage of revenues decreased to 39% for the three months ended June 30, 2024 from 42% for the three months ended June 30, 2023.

Writer royalties and other publishing costs for the Music Publishing segment increased by $1,130 thousand, or 12%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Writer royalties and other publishing costs as a percentage of Music Publishing revenues decreased to 44% for the three months ended June 30, 2024 from 46% for the three months ended June 30, 2023. The increase in margins was due to the change in the mix of revenue by type and songwriting clients with their specific contractual royalty rates being applied to the revenues.

Artist royalties and other recorded music costs for the Recorded Music segment decreased by $1,321 thousand, or 33%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Artist royalties and other recorded music costs as a percentage of recorded music revenues decreased to 27% for the three months ended June 30, 2024 from 38% for the three months ended June 30, 2023. The decrease in artist royalties and other recorded music costs and increase in margins were due primarily to the decrease in physical sales and change in the mix of sales by type to a lower percentage of physical sales, which carry higher costs than other types of revenue.

Amortization and Depreciation

Our amortization and depreciation expenses are composed of the following amounts (in thousands):


	For the Three Months
	Ended June 30,					2024 vs. 2023
	2024		2023		$ Change		% Change
Music Publishing amortization and depreciation	$	4,601	$	4,303	$	298	7	%
Recorded Music amortization and depreciation		1,760		1,729		31	2	%
Other amortization and depreciation		24		24		—	—
Total amortization and depreciation	$	6,385	$	6,056	$	329	5	%

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Amortization and depreciation expense increased by $329 thousand, or 5%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, driven primarily by an increase in the Music Publishing segment. Music Publishing amortization and depreciation expense increased by $298 thousand, or 7%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, primarily due to the acquisition of additional music catalogs.

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Administration Expenses

Our administration expenses are composed of the following amounts (in thousands):


	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Music Publishing administration expenses	$	6,581	$	5,587	$	994	18	%
Recorded Music administration expenses		2,534		2,925		(391)	(13)	%
Other administration expenses		574		653		(79)	(12)	%
Total administration expenses	$	9,689	$	9,165	$	524	6	%

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Total administration expenses increased by $524 thousand, or 6%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, driven by an increase in the Music Publishing segment, partially offset by a decrease in the Recorded Music segment. Expressed as a percentage of revenues, administration expenses decreased to 28% for the three months ended June 30, 2024 from 29% for the three months ended June 30, 2023.

Music Publishing administration expenses increased by $994 thousand, or 18%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Expressed as a percentage of revenues, Music Publishing administration expenses were 27% for the three months ended June 30, 2024 and the three months ended June 30, 2023.

Recorded Music administration expenses decreased by $391 thousand, or 13%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Expressed as a percentage of revenue, Recorded Music administration expenses decreased to 26% for the three months ended June 30, 2024 from 28% for the three months ended June 30, 2023, primarily due to the non-recurrence of legal fees related to a matter incurred during the three months ended June 30, 2023.

Interest Expense

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Interest expense increased by $326 thousand, or 7%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, driven primarily by increased debt balances due to use of funds in acquisitions of music catalogs and writer signings, as well as an increase in SOFR. The Company expects its interest expense will increase on the portions of its borrowings that are hedged beginning in October 2024, as existing swaps mature, and new swap contracts become effective.

Loss on Foreign Exchange

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Loss on foreign exchange increased by $30 thousand for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. This change was due to fluctuations in the two foreign currencies we are directly exposed to, namely British pound sterling and euro.

(Loss) Gain on Fair Value of Swaps

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Loss on fair value of swaps was $490 thousand for the three months ended June 30, 2024. Gain on the fair value of swaps for the three months ended June 30, 2023 was $1,845 thousand. This change was due to marking to market our interest rate swap hedges.

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Income Tax (Benefit) Expense

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Income tax benefit was $294 thousand during the three months ended June 30, 2024 compared to income tax expense of $62 thousand during the three months ended June 30, 2023. The effective income tax rate during the three months ended June 30, 2024 was 39.3% compared to 27.5% during the three months ended June 30, 2023. During the three months ended June 30, 2024, the Company recorded an incremental tax benefit of approximately $103,000 to its deferred tax liabilities related to certain international intangible assets. Additionally, the change in the effective income tax rate reflect changes in the mix of income from multiple tax jurisdictions.

Net (Loss) Income

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Net loss was $453 thousand during the three months ended June 30, 2024 compared to the net income of $164 thousand during the three months ended June 30, 2023. The decrease in net income was driven primarily by the loss on fair value of swaps during the three months ended June 30, 2024 compared to gain on fair value of swaps during the three months ended June 30, 2023 and an increase in interest expense. These factors were partially offset by an increase in operating income, which reflects revenue growth and improved margins, and an income tax benefit in the three months ended June 30, 2024 compared to income tax expense in the three months ended June 30, 2023.

Non-GAAP Reconciliations

We use certain financial information, such as OIBDA, OIBDA Margin, EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin, which are non-GAAP financial measures, which means they have not been prepared in accordance with U.S. GAAP. Reservoir’s management uses these non-GAAP financial measures to evaluate our operations, measure its performance and make strategic decisions. We believe that the use of these non-GAAP financial measures provides useful information to investors and others in understanding our results of operations and trends in the same manner as our management and in evaluating our financial measures as compared to the financial measures of other similar companies, many of which present similar non-GAAP financial measures. However, these non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by our management about which items are excluded or included in determining these non-GAAP financial measures and, therefore, should not be considered as a substitute for net income, operating income or any other operating performance measures calculated in accordance with GAAP. Using such non-GAAP financial measures in isolation to analyze our business would have material limitations because the calculations are based on the subjective determination of our management regarding the nature and classification of events and circumstances. In addition, although other companies in our industry may report measures titled OIBDA, OIBDA margin, Adjusted EBITDA, and Adjusted EBITDA Margin, or similar measures, such non-GAAP financial measures may be calculated differently from how we calculate such non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, such non-GAAP financial measures should be considered alongside other financial performance measures and other financial results presented in accordance with GAAP. Reconciliations of OIBDA to operating income and EBITDA and Adjusted EBITDA to net income are provided below.

We consider operating income before non-cash depreciation of tangible assets and non-cash amortization of intangible assets (“OIBDA”) to be an important indicator of the operational strengths and performance of our businesses and believe this non-GAAP financial measure provides useful information to investors because it removes the significant impact of amortization from our results of operations and represents our measure of segment income. However, a limitation of the use of OIBDA as a performance measure is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in our businesses and other non-operating income (loss). Accordingly, OIBDA should be considered in addition to, not as a substitute for, operating income, net income attributable to us and other measures of financial performance reported in accordance with GAAP. In addition, our definition of OIBDA may differ from similarly titled measures used by other companies. OIBDA Margin is defined as OIBDA as a percentage of revenue.

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EBITDA is defined as earnings (net income or loss) before net interest expense, income tax expense, non-cash depreciation of tangible assets and non-cash amortization of intangible assets and is used by management to measure operating performance of the business. Adjusted EBITDA is defined as EBITDA further adjusted to exclude items or expenses such as, among others, (1) any non-cash charges (including any impairment charges), (2) any net gain or loss on foreign exchange, (3) any net gain or loss resulting from interest rate swaps, (4) equity-based compensation expense and (5) certain unusual or non-recurring items. Adjusted EBITDA is a key measure used by our management to understand and evaluate operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. However, certain limitations on the use of Adjusted EBITDA include, among others, (1) it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenue for our business, (2) it does not reflect the significant interest expense or cash requirements necessary to service interest or principal payments on our indebtedness and (3) it does not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments. In particular, Adjusted EBITDA measure adds back certain non-cash, unusual or non-recurring charges that are deducted in calculating net income; however, these are expenses that may recur, vary greatly and are difficult to predict. In addition, Adjusted EBITDA is not the same as net income or cash flow provided by operating activities as those terms are defined by GAAP and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of revenue.

Reconciliation of Operating Income to OIBDA

We use OIBDA as our primary measure of financial performance. The following tables reconcile operating income to OIBDA (in thousands):


	Consolidated
	For the Three Months
	Ended June 30,						2024 vs. 2023
	2024			2023			$ Change		% Change
Operating income	$	4,961		$	3,145		$	1,816	58	%
Amortization and depreciation expenses		6,385			6,056			329	5	%
OIBDA	$	11,346		$	9,201		$	2,145	23	%

OIBDA Margin		33	%		29	%


	Music Publishing
	For the Three Months
	Ended June 30,							2024 vs. 2023
	2024			2023			$ Change		% Change
Operating income	$	2,183		$	1,396		$	787	56	%
Amortization and depreciation expenses		4,601			4,303			298	7	%
OIBDA	$	6,784		$	5,699		$	1,085	19	%

OIBDA Margin		28	%		27	%


	Recorded Music
	For the Three Months
	Ended June 30,						2024 vs. 2023
	2024			2023			$ Change		% Change
Operating income	$	2,691		$	1,764		$	927	53	%
Amortization and depreciation expenses		1,760			1,729			31	2	%
OIBDA	$	4,451		$	3,493		$	958	27	%

OIBDA Margin		46	%		34	%

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OIBDA

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Consolidated OIBDA increased by $2,145 thousand, or 23%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, driven by a $1,085 thousand increase in Music Publishing OIBDA and a $958 thousand increase in Recorded Music OIBDA. Expressed as a percentage of revenue, OIBDA Margin increased to 33% for the three months ended June 30, 2024 from 29% for the three months ended June 30, 2023.

Music Publishing OIBDA increased by $1,085 thousand, or 19%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Expressed as a percentage of revenue, Music Publishing OIBDA Margin increased to 28% in the three months ended June 30, 2024 from 27% in the three months ended June 30, 2023. The increases in Music Publishing OIBDA and OIBDA Margin reflect revenue growth and improved margins.

Recorded Music OIBDA increased by $958 thousand, or 27% during the three months ended June 30, 2024 compared to the three months ended June 30, 2023. Expressed as a percentage of revenue, Recorded Music OIBDA Margin increased to 46% during the three months ended June 30, 2024 from 34% in the three months ended June 30, 2023, driven primarily by the change in the mix of revenue by type to a lower percentage of physical sales.

Reconciliation of Net (Loss) Income to EBITDA and Adjusted EBITDA

The following table reconciles net income to Adjusted EBITDA (in thousands):


	For the Three Months
	Ended June 30,				2024 vs. 2023
	2024		2023		$ Change		% Change
Net (loss) income	$	(453)	$	164	$	(617)	NM
Income tax (benefit) expense		(294)		62		(356)	NM
Interest expense		5,059		4,734		325	7	%
Amortization and depreciation		6,385		6,056		329	5	%
EBITDA		10,697		11,016		(319)	(3)	%
Loss on foreign exchange^(a)		59		30		30	99	%
Loss (gain) on fair value of swaps^(b)		490		(1,845)		2,335	(127)	%
Non-cash share-based compensation^(c)		1,274		914		360	39	%
Other expense (income), net^(d)		100		—		100	NM
Adjusted EBITDA	$	12,620	$	10,115	$	2,505	25	%

NM - Not meaningful

(a)

Reflects the (gain) or loss on foreign exchange fluctuations.

(b)

Reflects the non-cash loss or (gain) on the mark-to-market of interest rate swaps.

(c)

Reflects non-cash share-based compensation expense related to the Reservoir Media, Inc. 2021 Omnibus Incentive Plan.

(d)

Reflects the Company’s share of loss recorded by an equity method investment.

Three Months Ended June 30, 2024 vs. Three Months Ended June 30, 2023

Adjusted EBITDA increased by $2,505 thousand, or 25%, during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, primarily as a result of revenue growth and improved margins. Adjusted EBITDA Margin increased to 37% during the three months ended June 30, 2024 compared to 32% during the three months ended June 30, 2023, primarily due to revenue growth, improved gross margins driven by a lower percentage of physical revenue, and effective cost management.

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Liquidity and Capital Resources

Capital Resources

As of June 30, 2024, we had $324,127 thousand of debt (net of $4,701 thousand of deferred financing costs) and $16,359 thousand of cash and cash equivalents.

Cash Flows

The following table summarizes our historical cash flows (in thousands).


	For the Three Months Ended
	June 30,				2024 vs.2023
	2024		2023		$ Change		% Change
Cash provided by (used for):
Operating activities	$	8,556	$	(861)	$	9,417	NM
Investing activities	$	(1,899)	$	(15,227)	$	13,328	(88)	%
Financing activities	$	(8,415)	$	13,294	$	(21,709)	(163)	%

NM - Not meaningful

Operating Activities

Cash provided by operating activities was $8,556 thousand for the three months ended June 30, 2024 compared to cash used for operating activities of $861 thousand for the three months ended June 30, 2023. The primary driver of the $9,417 thousand increase in cash provided by operating activities during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 was an increase in royalty advance recoupments and the timing of collection of accounts receivable, partially offset by the timing of payments for royalties payable and accounts payable and accrued expenses.

Investing Activities

Cash used for investing activities was $1,899 thousand for the three months ended June 30. 2024 compared to $15,227 thousand for the three months ended June 30, 2023. The decrease in cash used in investing activities was primarily due to a decrease in acquisitions of music catalogs.

Financing Activities

Cash (used for) provided by financing activities was $(8,415) thousand for the three months ended June 30, 2024 compared to $13,294 thousand for the three months ended June 30, 2023. The change in cash (used for) provided by financing activities in the three months ended June 30, 2024 primarily reflects an $11,000 thousand decrease in borrowings used for investing activities and a $10,000 thousand repayment towards the secured line of credit.

Liquidity

Our primary sources of liquidity are the cash flows generated from our subsidiaries’ operations, available cash and cash equivalents and funds available for drawing under our Senior Credit Facility (as described below). These sources of liquidity are needed to fund our debt service requirements, working capital requirements, strategic acquisitions and investments, capital expenditures and other investing and financing activities we may elect to make in the future.

We believe that our primary sources of liquidity will be sufficient to support our existing operations over the next twelve months.

Existing Debt as of June 30, 2024

As of June 30, 2024, our outstanding debt consisted of $328,828 thousand borrowed under the Senior Credit Facility. As of June 30. 2024, remaining borrowing availability under the Senior Credit Facility was $121,172 thousand.

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We use cash generated from operations to service outstanding debt, consisting primarily of interest payments through maturity, and we expect to continue to refinance and extend maturity on the Senior Credit Facility for the foreseeable future.

Debt Capital Structure

RMM is party to a credit agreement (as amended or supplemented from time to time, the “RMM Credit Agreement”) governing RMM’s $450,000 thousand senior secured revolving credit facility (the “Senior Credit Facility”). The Senior Credit Facility also includes an “accordion feature” that permits RMM to seek additional commitments in an amount not to exceed $150,000 thousand. The maturity date of the loans advanced under the Senior Credit Facility is December 16, 2027.

Subject to market conditions, we expect to continue to take opportunistic steps to extend our maturity dates and reduce related interest expense. From time to time, we may incur additional indebtedness for, among other things, working capital, repurchasing, redeeming or tendering for existing indebtedness and acquisitions or other strategic transactions.

Certain terms of the Senior Credit Facility are described below.

Guarantees and Security

The obligations under the Senior Credit Facility are guaranteed by us, RHI and subsidiaries of RMM. Substantially all of our, RHI’s, RMM’s and other subsidiary guarantors’ tangible and intangible assets are pledged as collateral to secure the obligations of RMM under the Senior Credit Facility, including accounts receivable, cash and cash equivalents, deposit accounts, securities accounts, commodities accounts, inventory and certain intercompany debt owing to us or our subsidiaries.

Covenants, Representations and Warranties

The Senior Credit Facility contains customary representations and warranties and customary affirmative and negative covenants. The negative covenants contained in the Senior Credit Facility limit the ability our, RHI’s, RMM’s and certain of its subsidiaries ability to, among other things, incur debt or liens, merge or consolidate with others, make investments, make cash dividends, redeem or repurchase capital stock, dispose of assets, enter into transactions with affiliates or enter into certain restrictive agreements.

Events of Default

The Senior Credit Facility includes customary events of default, including nonpayment of principal when due, nonpayment of interest or other amounts, inaccuracy of representations or warranties in any material respect, violation of covenants, certain bankruptcy or insolvency events, certain ERISA events and certain material judgments, in each case, subject to customary thresholds, notice and grace period provisions.

Covenant Compliance

The Senior Credit Facility contains financial covenants that requires us, on a consolidated basis with our subsidiaries, to maintain, (i) a fixed charge coverage ratio of not less than 1.10:1.00 for each four fiscal quarter period, and (ii) a consolidated senior debt to library value ratio of no greater than 0.45:1.00, subject to certain adjustments.

Non-compliance with the fixed charge coverage ratio and consolidated senior debt to library value ratio could result in the lenders, subject to customary cure rights, requiring the immediate payment of all amounts outstanding under the Senior Credit Facility, which could have a material adverse effect on our business, cash flows, financial condition and results of operations. As of June 30, 2024, we were in compliance with both of the financial covenants under the Senior Credit Facility.

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Interest Rate Swaps


	Notional
	Amount at		Pay Fixed
Effective Date	June 30, 2024		Rate		Maturity
March 10, 2022	$	7,625	1.533	%	September 2024
March 10, 2022	$	87,502	1.422	%	September 2024
December 31, 2021	$	54,873	0.972	%	September 2024
September 30, 2024	$	100,000	2.946	%	December 2027
September 30, 2024	$	50,000	3.961	%	December 2027

Dividends

Our ability to pay dividends is restricted by covenants in the Senior Credit Facility. We did not pay any dividends to stockholders during the three months ended June 30, 2024.

Summary

Management believes that funds generated from our operations, borrowings under the Senior Credit Facility and available cash and equivalents will be sufficient to fund our debt service requirements, working capital requirements and capital expenditure requirements for the foreseeable future. However, our ability to continue to fund these items and to reduce debt may be affected by general economic, financial, competitive, legislative and regulatory factors, as well as other industry-specific factors such as the ability to control music piracy and the continued transition from physical to digital formats in the recorded music and music publishing industries. It could also be affected by the severity and duration of natural or human-made disasters, including pandemics. We and our affiliates continue to evaluate opportunities to, from time to time, depending on market conditions and prices, contractual restrictions, our financial liquidity and other factors, seek to pay dividends or prepay outstanding debt or repurchase or retire our outstanding debt. The amounts involved in any such transactions, individually or in the aggregate, may be material and may be funded from available cash or from additional borrowings or equity raises. In addition, from time to time, depending on market conditions and prices, contractual restrictions, our financial liquidity, and other factors, we may seek to refinance the Senior Credit Facility with existing cash and/or with funds provided from additional borrowings.

Contractual and Other Obligations

As of June 30, 2024, there have been no material changes, outside the ordinary course of business, in our contractual obligations since March 31, 2024. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Contractual and Other Obligations” in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on May 30, 2024 for information regarding our contractual obligations.

Critical Accounting Policies

As of June 30, 2024, there have been no material changes to our critical accounting policies since March 31, 2024. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on May 30, 2024 for information regarding our critical accounting policies. We believe that our accounting policies involve a high degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of our operations. The preparation of our condensed consolidated financial statements in conformity with US GAAP requires us to make estimates and judgments that affect the amounts reported in those condensed consolidated financial statements and the accompanying notes thereto. We believe we have used reasonable estimates and assumptions in preparing the condensed consolidated financial statements. Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates.

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Off-Balance Sheet Arrangements

As of June 30, 2024, we had no off-balance sheet arrangements.

New Accounting Pronouncements

See Note 3, “Recent Accounting Pronouncements” to the accompanying unaudited condensed consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this Item 3, “Quantitative and Qualitative Disclosures About Market Risk.”

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of June 30, 2024, as such term is defined in Rules 13a-15(e) and 15(d)-15(e) under the Exchange Act.

As a result of the material weaknesses in our internal controls over financial reporting, as previously disclosed under Part II “Item 9A, Controls and Procedures” in our Annual Report on Form 10-K for the year ended March 31, 2024 (the “Annual Report”), our principal executive officer and principal financial and accounting officer concluded that during the period covered by this Quarterly Report our disclosure controls and procedures were not effective as of June 30, 2024. Notwithstanding these material weaknesses, management has concluded that the condensed consolidated financial statements included in this Quarterly Report are fairly stated in all material respects in accordance with U.S. GAAP.

Remediation Plan and Status of Material Weaknesses

We continue to take steps to remediate the material weaknesses described in our Annual Report by continuing to hire qualified accounting personnel and further evolving our accounting processes. We retained third party experts on complex technical accounting issues and taxes, as well as hired additional accounting personnel with the requisite experience to improve the process around financial reporting. We are actively improving our risk assessment activities, implementing corrective actions to support our remediation of the material weaknesses noted above. This includes, but is not limited to, providing training to process and control owners, enhancing relevant policies, procedures, guidelines and documentation templates, implementing new controls and improving documentation supporting existing controls, and enhancing segregation of duties by reducing access to our Enterprise Resource Planning (ERP) system. The evaluation over whether these improved control activities have been designed effectively, is ongoing.

In future periods, we will ensure that the improved processes and controls have been designed and implemented effectively, and we will also evaluate the operating effectiveness of the new and redesigned controls.

We will not be able to fully remediate these material weaknesses until the applicable controls operate for a sufficient period of time, and we have concluded, through testing, that the newly implemented and enhanced controls are operating effectively. Our management will continue to monitor the effectiveness of our remediation plans in future periods and will make changes we determine to be appropriate.

Changes in Internal Control over Financial Reporting

Except as disclosed above, there have been no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the three months ended June 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Limitations on Controls and Procedures

Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all cases of error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We may, from time to time, become involved in various legal and administrative proceedings, claims, lawsuits and/or other actions incidental to the conduct of our business. Some of these legal and administrative proceedings, claims, lawsuits and/or other actions may be material and involve highly complex issues that are subject to substantial uncertainties and could result in damages, fines, penalties, non-monetary sanctions or relief. We recognize provisions for claims or pending litigation when we determine that an unfavorable outcome is probable and the amount of loss can be reasonably estimated. Due to the inherently uncertain nature of litigation, the ultimate outcome or actual cost of settlement may materially vary from estimates. As of the date of this Quarterly Report, we are not involved in any legal proceedings that we believe could have a material adverse effect on our business, financial condition and/or results of operations.

Item 1A. Risk Factors.

There have been no material changes in the Company’s risk factors from those disclosed in Part I, Item 1A to the Company’s Annual Report for the year ended March 31, 2024. The risk factors disclosed in the Annual Report, in addition to the other information set forth in this report, could materially affect our business, financial condition or results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

There have been no other unregistered sales of equity securities during the three months ended June 30, 2024 which have not been previously disclosed on a Current Report on Form 8-K.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements

None of our directors or officers (as defined in Rule 16a-1 (f) under the Exchange Act) adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (each as defined in Item 408 of Regulation S-K) during the quarterly period covered by this Quarterly Report on Form 10-Q.

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Item 6. Exhibits

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report.

No.		Description of Exhibit
31.1*		Certification of Chief Executive Officer Pursuant to Securities Exchange Act Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

†	Certain of the schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby undertakes to furnish copies of any of the omitted schedules or exhibits upon request by the SEC.

*	Filed herewith.

**	Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	RESERVOIR MEDIA, INC.

Date: July 31, 2024	By:	/s/ Golnar Khosrowshahi
		Name: Golnar Khosrowshahi
		Title: Chief Executive Officer (Principal Executive Officer)

Date: July 31, 2024	By:	/s/ Jim Heindlmeyer
		Name: Jim Heindlmeyer
		Title: Chief Financial Officer
		(Principal Financial and Accounting Officer)

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULE 13A-14(A) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Golnar Khosrowshahi, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Reservoir Media, Inc. (the “registrant”);

Based on my knowledge, this Quarterly Report on Form 10-Q does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Quarterly Report on Form 10-Q;

Based on my knowledge, the financial statements, and other financial information included in this Quarterly Report on Form 10-Q, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Quarterly Report on Form 10-Q;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Quarterly Report on Form 10-Q our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Quarterly Report on Form 10-Q based on such evaluation; and

Disclosed in this Quarterly Report on Form 10-Q any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 31, 2024

	By:	/s/ Golnar Khosrowshahi
		Name: Golnar Khosrowshahi
		Title: Chief Executive Officer (Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13A-14(A) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jim Heindlmeyer, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Reservoir Media, Inc. (the “registrant”);

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 31, 2024

	By:	/s/ Jim Heindlmeyer
		Name: Jim Heindlmeyer
		Title: Chief Financial Officer
		(Principal Financial and Accounting Officer)

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Reservoir Media, Inc. (the “Company”) for the period ended June 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Golnar Khosrowshahi, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended, that:

●

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

●

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: July 31, 2024

	By:	/s/ Golnar Khosrowshahi
		Name: Golnar Khosrowshahi
		Title: Chief Executive Officer (Principal Executive Officer)

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Reservoir Media, Inc. (the “Company”) for the period ended June 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jim Heindlmeyer, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended, that:

●

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

●

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: July 31, 2024

	By:	/s/ Jim Heindlmeyer
		Name: Jim Heindlmeyer
		Title: Chief Financial Officer
		(Principal Financial and Accounting Officer)

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Jun. 30, 2024	Jul. 26, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-39795
Entity Registrant Name	RESERVOIR MEDIA, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	83-3584204
Entity Address, Address Line One	200 Varick Street
Entity Address, Address Line Two	Suite 801
Entity Address, City or Town	NY
Entity Address State Or Province	NY
Entity Address, Postal Zip Code	10014
City Area Code	212
Local Phone Number	675-0541
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		65,078,938
Entity Central Index Key	0001824403
Current Fiscal Year End Date	--03-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false
Common Stock
Document and Entity Information
Title of 12(b) Security	Common Stock, $0.0001 par value per share (the “Common Stock”)
Trading Symbol	RSVR
Security Exchange Name	NASDAQ
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share
Document and Entity Information
Title of 12(b) Security	Warrants to purchase one share of CommonStock, each at an exercise price of $11.50 per share
Trading Symbol	RSVRW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME
Revenues	$ 34,316,843	$ 31,836,586
Costs and expenses:
Cost of revenue	13,281,116	13,471,597
Amortization and depreciation	6,384,757	6,055,568
Administration expenses	9,689,437	9,164,500
Total costs and expenses	29,355,310	28,691,665
Operating income	4,961,533	3,144,921
Interest expense	(5,059,398)	(4,733,533)
Loss on foreign exchange	(59,463)	(29,936)
(Loss) gain on fair value of swaps	(490,295)	1,845,387
Other (expense) income, net	(99,522)	62
(Loss) income before income taxes	(747,145)	226,901
Income tax (benefit) expense	(293,968)	62,348
Net (loss) income	(453,177)	164,553
Net loss attributable to noncontrolling interests	106,522	112,780
Net (loss) income attributable to Reservoir Media, Inc.	$ (346,655)	$ 277,333
(Loss) earnings per common share (Note 13):
Basic	$ (0.01)
Diluted	$ (0.01)
Weighted average common shares outstanding (Note 13):
Basic	64,970,693	64,572,432
Diluted	64,970,693	64,998,544

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
Net (loss) income	$ (453,177)	$ 164,553
Other comprehensive income:
Translation adjustments	34,852	1,139,476
Total comprehensive (loss) income	(418,325)	1,304,029
Comprehensive loss attributable to noncontrolling interests	106,522	112,780
Total comprehensive (loss) income attributable to Reservoir Media, Inc.	$ (311,803)	$ 1,416,809

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2024	Mar. 31, 2024
Current assets
Cash and cash equivalents	$ 16,358,506	$ 18,132,015
Accounts receivable	32,081,489	33,227,382
Current portion of royalty advances	12,917,635	13,248,008
Inventory and prepaid expenses	6,163,776	6,300,915
Total current assets	67,521,406	70,908,320
Intangible assets, net	634,724,872	640,222,000
Equity method and other investments	1,355,019	1,451,924
Royalty advances, net of current portion and reserves	50,747,131	56,527,557
Property, plant and equipment, net	520,220	551,410
Operating lease right of use assets, net	6,736,634	6,988,340
Fair value of swap assets	5,141,819	5,753,488
Other assets	1,410,949	1,131,529
Total assets	768,158,050	783,534,568
Current liabilities
Accounts payable and accrued liabilities	5,123,049	9,015,939
Royalties payable	38,656,663	40,395,205
Accrued payroll	883,248	2,043,772
Deferred revenue	1,102,261	1,163,953
Other current liabilities	6,371,704	7,313,615
Income taxes payable	541,503	439,152
Total current liabilities	52,678,428	60,371,636
Secured line of credit	324,127,393	330,791,607
Deferred income taxes	30,028,349	30,471,978
Operating lease liabilities, net of current portion	6,431,339	6,720,287
Fair value of swap liability		121,374
Other liabilities	469,589	572,705
Total liabilities	413,735,098	429,049,587
Contingencies and commitments (Note 15)
Shareholders' Equity
Preferred stock, $0.0001 par value 75,000,000 shares authorized, 0 shares issued and outstanding at June 30, 2024 and March 31, 2024
Common stock, $0.0001 par value; 750,000,000 shares authorized, 65,078,938 shares issued and outstanding at June 30, 2024; 64,826,864 shares issued and outstanding at March 31, 2024	6,508	6,483
Additional paid-in capital	341,744,622	341,388,351
Retained earnings	15,051,002	15,397,657
Accumulated other comprehensive loss	(3,762,881)	(3,797,733)
Total Reservoir Media, Inc. shareholders' equity	353,039,251	352,994,758
Noncontrolling interest	1,383,701	1,490,223
Total shareholders' equity	354,422,952	354,484,981
Total liabilities and shareholders' equity	$ 768,158,050	$ 783,534,568

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2024	Mar. 31, 2024
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	75,000,000	75,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	750,000,000	750,000,000
Common stock, shares issued	65,078,938	64,826,864
Common stock, shares outstanding	65,078,938	64,826,864

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($)	Common Stock	Additional paid-in capital	Retained earnings	Accumulated other comprehensive loss	Noncontrolling interests	Total
Beginning balance at Mar. 31, 2023	$ 6,444	$ 338,460,789	$ 14,752,720	$ (4,855,329)	$ 1,297,899	$ 349,662,523
Beginning balance (in shares) at Mar. 31, 2023	64,441,244
Increase (Decrease) in Stockholders' Equity
Share-based compensation		713,802				713,802
Vesting of restricted stock units, net of shares withheld for employee taxes	$ 21	(689,176)				(689,155)
Vesting of restricted stock units, net of shares withheld for employee taxes (in shares)	207,733
Reclassification of liability-classified awards to equity-classified awards		664,167				664,167
Net income (loss)			277,333		(112,780)	164,553
Other comprehensive income				1,139,476		1,139,476
Ending balance at Jun. 30, 2023	$ 6,465	339,149,582	15,030,053	(3,715,853)	1,185,119	351,655,366
Ending balance (in shares) at Jun. 30, 2023	64,648,977
Beginning balance at Mar. 31, 2024	$ 6,483	341,388,351	15,397,657	(3,797,733)	1,490,223	354,484,981
Beginning balance (in shares) at Mar. 31, 2024	64,826,864
Increase (Decrease) in Stockholders' Equity
Share-based compensation		1,048,520				1,048,520
Stock option exercises		18,140				18,140
Stock option exercises (in shares)	3,550
Vesting of restricted stock units, net of shares withheld for employee taxes	$ 25	(1,432,889)				(1,432,864)
Vesting of restricted stock units, net of shares withheld for employee taxes (in shares)	248,524
Reclassification of liability-classified awards to equity-classified awards		722,500				722,500
Net income (loss)			(346,655)		(106,522)	(453,177)
Other comprehensive income				34,852		34,852
Ending balance at Jun. 30, 2024	$ 6,508	$ 341,744,622	$ 15,051,002	$ (3,762,881)	$ 1,383,701	$ 354,422,952
Ending balance (in shares) at Jun. 30, 2024	65,078,938

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net (loss) income	$ (453,177)	$ 164,553
Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities:
Amortization of intangible assets	6,326,863	5,997,512
Depreciation of property, plant and equipment	57,894	58,056
Share-based compensation	1,273,674	914,426
Amortization of deferred financing costs	335,786	334,121
Loss (gain) on fair value of swaps	490,295	(1,845,387)
Loss from equity affiliates	100,000
Deferred income taxes	(446,780)
Changes in operating assets and liabilities:
Accounts receivable	1,145,893	(759,449)
Inventory and prepaid expenses	137,139	369,841
Royalty advances	6,121,523	(2,960,260)
Other assets and liabilities	(100,897)	188,150
Accounts payable, accrued expenses and deferred revenue	(4,796,318)	(3,323,134)
Royalties payable	(1,738,542)	(9,520)
Income taxes payable	102,351	9,754
Net cash provided by (used for) operating activities	8,555,704	(861,337)
Cash flows from investing activities:
Purchases of music catalogs	(1,871,957)	(15,134,924)
Purchase of property, plant and equipment	(26,704)	(91,660)
Net cash used for investing activities	(1,898,661)	(15,226,584)
Cash flows from financing activities:
Proceeds from secured line of credit	3,000,000	14,000,000
Repayments of secured line of credit	(10,000,000)
Proceeds from stock option exercises	18,140
Taxes paid related to net share settlement of restricted stock units	(1,432,864)	(689,155)
Deferred financing costs paid		(16,904)
Net cash (used for) provided by financing activities	(8,414,724)	13,293,941
Foreign exchange impact on cash	(15,828)	142,000
Decrease in cash and cash equivalents	(1,773,509)	(2,651,980)
Cash and cash equivalents beginning of period	18,132,015	14,902,076
Cash and cash equivalents end of period	$ 16,358,506	$ 12,250,096

DESCRIPTION OF BUSINESS

3 Months Ended

Jun. 30, 2024

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS

NOTE 1. DESCRIPTION OF BUSINESS

BASIS OF PRESENTATION

3 Months Ended

Jun. 30, 2024

BASIS OF PRESENTATION

BASIS OF PRESENTATION

NOTE 2. BASIS OF PRESENTATION

RECENT ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Jun. 30, 2024

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Standards Not Yet Adopted

REVENUE RECOGNITION

3 Months Ended

Jun. 30, 2024

REVENUE RECOGNITION

REVENUE RECOGNITION

NOTE 4. REVENUE RECOGNITION

Disaggregation of Revenue

The Company’s revenue consisted of the following categories during the three months ended June 30, 2024 and 2023:


	Three Months Ended June 30,
	2024		2023
Revenue by Type
Digital	$	14,634,703	$	11,900,517
Performance		5,134,426		4,514,904
Synchronization		2,811,017		3,032,699
Mechanical		668,973		559,647
Other		751,174		783,548
Total Music Publishing		24,000,293		20,791,315

Digital		6,558,170		5,622,649
Physical		1,352,341		3,574,551
Neighboring rights		1,106,350		859,147
Synchronization		613,643		328,290
Total Recorded Music		9,630,504		10,384,637

Other revenue	$	686,046		660,634
Total revenue	$	34,316,843	$	31,836,586


	Three Months Ended June 30,
	2024		2023
Revenue by Geographical Location
United States Music Publishing	$	13,789,192	$	13,000,994
United States Recorded Music		5,696,630		5,524,763
United States other revenue		686,046		660,634
Total United States		20,171,868		19,186,391
International Music Publishing		10,211,101		7,790,321
International Recorded Music		3,933,874		4,859,874
Total International		14,144,975		12,650,195
Total revenue	$	34,316,843	$	31,836,586

Only the United States represented 10% or more of the Company’s total revenues in the three months ended June 30, 2024 and 2023.

Deferred Revenue

The following table reflects the change in deferred revenue during the three months ended June 30, 2024 and 2023:


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	1,163,953	$	2,151,889
Cash received during period		933,713		493,290
Revenue recognized during period		(995,405)		(1,189,250)
Balance at end of period	$	1,102,261	$	1,455,929

ACQUISITIONS

3 Months Ended

Jun. 30, 2024

ACQUISITIONS

ACQUISITIONS

NOTE 5. ACQUISITIONS

INTANGIBLE ASSETS

3 Months Ended

Jun. 30, 2024

INTANGIBLE ASSETS

INTANGIBLE ASSETS

NOTE 6. INTANGIBLE ASSETS

Intangible assets subject to amortization consist of the following as of June 30, 2024 and March 31, 2024:


	June 30, 2024		March 31, 2024
Intangible assets subject to amortization:
Publishing and recorded music catalogs	$	770,493,046	$	769,648,966
Artist management contracts		913,272		911,740
Gross intangible assets		771,406,318		770,560,706
Accumulated amortization		(136,681,446)		(130,338,706)
Intangible assets, net	$	634,724,872	$	640,222,000

Straight-line amortization expense totaled $6,326,863 and $5,997,512 in the three months ended June 30, 2024 and 2023, respectively.

ROYALTY ADVANCES

3 Months Ended

Jun. 30, 2024

ROYALTY ADVANCES

ROYALTY ADVANCES

NOTE 7. ROYALTY ADVANCES

The following table reflects the change in royalty advances, net during the three months ended June 30, 2024 and 2023:


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	69,775,565	$	66,926,500
Additions		2,396,796		6,199,316
Recoupments		(8,507,595)		(3,239,056)
Balance at end of period	$	63,664,766	$	69,886,760

SECURED LINE OF CREDIT

3 Months Ended

Jun. 30, 2024

SECURED LINE OF CREDIT

SECURED LINE OF CREDIT

NOTE 8. SECURED LINE OF CREDIT

Long-term debt consists of the following:


	June 30, 2024		March 31, 2024
Secured line of credit	$	328,828,409	$	335,828,410
Debt issuance costs, net		(4,701,016)		(5,036,803)
	$	324,127,393	$	330,791,607

Credit Facilities

As of June 30, 2024, the Senior Credit Facility had a borrowing capacity of $450,000,000, with remaining borrowing availability of $121,171,591.

Interest Rate Swaps


	Notional		Pay
	Amount at		Fixed
Effective Date	June 30, 2024		Rate		Maturity
March 10, 2022	$	7,625,000	1.533	%	September 2024
March 10, 2022	$	87,501,612	1.422	%	September 2024
December 31, 2021	$	54,873,388	0.972	%	September 2024
September 30, 2024	$	100,000,000	2.946	%	December 2027
September 30, 2024	$	50,000,000	3.961	%	December 2027

INCOME TAXES

3 Months Ended

Jun. 30, 2024

INCOME TAXES

INCOME TAXES

NOTE 9. INCOME TAXES

SUPPLEMENTARY CASH FLOW INFORMATION

3 Months Ended

Jun. 30, 2024

SUPPLEMENTARY CASH FLOW INFORMATION

SUPPLEMENTARY CASH FLOW INFORMATION

NOTE 10. SUPPLEMENTARY CASH FLOW INFORMATION

Interest paid and income taxes paid for the three months ended June 30, 2024 and 2023 were comprised of the following:


	2024		2023
Interest paid	$	4,842,444	$	4,333,987
Income taxes paid	$	44,212	$	58,157

Non-cash investing and financing activities for the three months ended June 30, 2024 and 2023 were comprised of the following:


	2024		2023
Acquired intangible assets included in other liabilities	$	—	$	1,355,000
Reclassification of liability-classified awards to equity-classified awards	$	722,500	$	664,167

WARRANTS

3 Months Ended

Jun. 30, 2024

WARRANTS

WARRANTS

NOTE 11. WARRANTS

SHARE-BASED COMPENSATION

3 Months Ended

Jun. 30, 2024

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

NOTE 12. SHARE-BASED COMPENSATION

(LOSS) EARNINGS PER SHARE

3 Months Ended

Jun. 30, 2024

(LOSS) EARNINGS PER SHARE

(LOSS) EARNINGS PER SHARE

NOTE 13. (LOSS) EARNINGS PER SHARE

The following table summarizes the basic and diluted (loss) earnings per common share calculation for the three months ended June 30, 2024 and 2023:


		Three Months Ended
		June 30,
		2024	2023

Basic (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
(Loss) earnings per common share - basic	$	(0.01)	$	—

Diluted (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
Weighted average effect of potentially dilutive securities:
Effect of dilutive stock options and RSUs		—		426,112
Weighted average common shares outstanding - diluted		64,970,693		64,998,544
(Loss) earnings per common share - diluted	$	(0.01)	$	—

FINANCIAL INSTRUMENTS

3 Months Ended

Jun. 30, 2024

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS

NOTE 14. FINANCIAL INSTRUMENTS

The Company is exposed to the following risks related to its financial instruments:

(a)

Credit Risk

(b)

Interest Rate Risk

(c)

Foreign Exchange Risk

The Company is exposed to foreign exchange risk in fluctuations of currency rates on its revenue from royalties, writers’ fees and its subsidiaries’ operations.

(d)

Financial Instruments

CONTINGENCIES AND COMMITMENTS

3 Months Ended

Jun. 30, 2024

CONTINGENCIES AND COMMITMENTS

CONTINGENCIES AND COMMITMENTS

NOTE 15. CONTINGENCIES AND COMMITMENTS

(a)

Litigation

SEGMENT REPORTING

3 Months Ended

Jun. 30, 2024

SEGMENT REPORTING

SEGMENT REPORTING

NOTE 16. SEGMENT REPORTING

The following tables present total revenue and reconciliation of OIBDA to operating income by segment for the three months ended June 30, 2024 and 2023:


	Three Months Ended June 30, 2024
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	24,000,293	$	9,630,504	$	686,046	$	34,316,843

Reconciliation of OIBDA to operating income:
Operating income		2,182,422		2,691,278		87,833		4,961,533
Amortization and depreciation		4,601,128		1,759,822		23,807		6,384,757
OIBDA	$	6,783,550	$	4,451,100	$	111,640	$	11,346,290


	Three Months Ended June 30, 2023
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	20,791,315	$	10,384,637	$	660,634	$	31,836,586

Reconciliation of OIBDA to operating income (loss):
Operating income (loss)		1,396,472		1,763,796		(15,347)		3,144,921
Amortization and depreciation		4,302,844		1,729,152		23,572		6,055,568
OIBDA	$	5,699,316	$	3,492,948	$	8,225	$	9,200,489

Pay vs Performance Disclosure - USD ($)	3 Months Ended
Pay vs Performance Disclosure - USD ($)	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (346,655)	$ 277,333

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Non Rule 10b5-1 Arrangement Modified	false
Rule 10b5-1 Arrangement Modified	false

RECENT ACCOUNTING PRONOUNCEMENTS (Policies)

3 Months Ended

Jun. 30, 2024

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Standards Not Yet Adopted

REVENUE RECOGNITION (Tables)

3 Months Ended

Jun. 30, 2024

REVENUE RECOGNITION

Schedule of revenue


	Three Months Ended June 30,
	2024		2023
Revenue by Type
Digital	$	14,634,703	$	11,900,517
Performance		5,134,426		4,514,904
Synchronization		2,811,017		3,032,699
Mechanical		668,973		559,647
Other		751,174		783,548
Total Music Publishing		24,000,293		20,791,315

Digital		6,558,170		5,622,649
Physical		1,352,341		3,574,551
Neighboring rights		1,106,350		859,147
Synchronization		613,643		328,290
Total Recorded Music		9,630,504		10,384,637

Other revenue	$	686,046		660,634
Total revenue	$	34,316,843	$	31,836,586


	Three Months Ended June 30,
	2024		2023
Revenue by Geographical Location
United States Music Publishing	$	13,789,192	$	13,000,994
United States Recorded Music		5,696,630		5,524,763
United States other revenue		686,046		660,634
Total United States		20,171,868		19,186,391
International Music Publishing		10,211,101		7,790,321
International Recorded Music		3,933,874		4,859,874
Total International		14,144,975		12,650,195
Total revenue	$	34,316,843	$	31,836,586

Schedule of change in deferred revenue


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	1,163,953	$	2,151,889
Cash received during period		933,713		493,290
Revenue recognized during period		(995,405)		(1,189,250)
Balance at end of period	$	1,102,261	$	1,455,929

INTANGIBLE ASSETS (Tables)

3 Months Ended

Jun. 30, 2024

INTANGIBLE ASSETS

Schedule of intangible assets subject to amortization


	June 30, 2024		March 31, 2024
Intangible assets subject to amortization:
Publishing and recorded music catalogs	$	770,493,046	$	769,648,966
Artist management contracts		913,272		911,740
Gross intangible assets		771,406,318		770,560,706
Accumulated amortization		(136,681,446)		(130,338,706)
Intangible assets, net	$	634,724,872	$	640,222,000

ROYALTY ADVANCES (Tables)

3 Months Ended

Jun. 30, 2024

ROYALTY ADVANCES

Schedule of royalty advances


	June 30, 2024		June 30, 2023
Balance at beginning of period	$	69,775,565	$	66,926,500
Additions		2,396,796		6,199,316
Recoupments		(8,507,595)		(3,239,056)
Balance at end of period	$	63,664,766	$	69,886,760

SECURED LINE OF CREDIT (Tables)

3 Months Ended

Jun. 30, 2024

SECURED LINE OF CREDIT

Schedule of long-term debt


	June 30, 2024		March 31, 2024
Secured line of credit	$	328,828,409	$	335,828,410
Debt issuance costs, net		(4,701,016)		(5,036,803)
	$	324,127,393	$	330,791,607

Schedule of interest rate swaps


	Notional		Pay
	Amount at		Fixed
Effective Date	June 30, 2024		Rate		Maturity
March 10, 2022	$	7,625,000	1.533	%	September 2024
March 10, 2022	$	87,501,612	1.422	%	September 2024
December 31, 2021	$	54,873,388	0.972	%	September 2024
September 30, 2024	$	100,000,000	2.946	%	December 2027
September 30, 2024	$	50,000,000	3.961	%	December 2027

SUPPLEMENTARY CASH FLOW INFORMATION (Tables)

3 Months Ended

Jun. 30, 2024

SUPPLEMENTARY CASH FLOW INFORMATION

Schedule of interest paid and income taxes paid


	2024		2023
Interest paid	$	4,842,444	$	4,333,987
Income taxes paid	$	44,212	$	58,157

Schedule of non-cash investing and financing activities


	2024		2023
Acquired intangible assets included in other liabilities	$	—	$	1,355,000
Reclassification of liability-classified awards to equity-classified awards	$	722,500	$	664,167

(LOSS) EARNINGS PER SHARE (Tables)

3 Months Ended

Jun. 30, 2024

(LOSS) EARNINGS PER SHARE

Summary of basic and diluted (loss) earnings per common share calculation


		Three Months Ended
		June 30,
		2024	2023

Basic (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
(Loss) earnings per common share - basic	$	(0.01)	$	—

Diluted (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$	(346,655)	$	277,333
Weighted average common shares outstanding - basic		64,970,693		64,572,432
Weighted average effect of potentially dilutive securities:
Effect of dilutive stock options and RSUs		—		426,112
Weighted average common shares outstanding - diluted		64,970,693		64,998,544
(Loss) earnings per common share - diluted	$	(0.01)	$	—

SEGMENT REPORTING (Tables)

3 Months Ended

Jun. 30, 2024

SEGMENT REPORTING

Schedule of total revenue and reconciliation of OIBDA to operating income by segment


	Three Months Ended June 30, 2024
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	24,000,293	$	9,630,504	$	686,046	$	34,316,843

Reconciliation of OIBDA to operating income:
Operating income		2,182,422		2,691,278		87,833		4,961,533
Amortization and depreciation		4,601,128		1,759,822		23,807		6,384,757
OIBDA	$	6,783,550	$	4,451,100	$	111,640	$	11,346,290


	Three Months Ended June 30, 2023
	Music		Recorded
	Publishing		Music		Other		Consolidated
Total revenue	$	20,791,315	$	10,384,637	$	660,634	$	31,836,586

Reconciliation of OIBDA to operating income (loss):
Operating income (loss)		1,396,472		1,763,796		(15,347)		3,144,921
Amortization and depreciation		4,302,844		1,729,152		23,572		6,055,568
OIBDA	$	5,699,316	$	3,492,948	$	8,225	$	9,200,489

DESCRIPTION OF BUSINESS (Details)	3 Months Ended
DESCRIPTION OF BUSINESS (Details)	Jun. 30, 2024 segment item $ / shares	Mar. 31, 2024 $ / shares	Jul. 28, 2021 $ / shares
DESCRIPTION OF BUSINESS
Common stock, par value (in dollars per share) \| $ / shares	$ 0.0001	$ 0.0001	$ 0.0001
Number of operating segments \| segment	2
Music Publishing
DESCRIPTION OF BUSINESS
Minimum ownership or control rights	150,000
Recorded Music
DESCRIPTION OF BUSINESS
Minimum ownership or control rights	36,000

REVENUE RECOGNITION (Details) - USD ($)	3 Months Ended
REVENUE RECOGNITION (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
Revenue recognized from performance obligations satisfied in previous period	$ 1,163,855	$ 1,295,141
Revenues	34,316,843	31,836,586
United States
Revenues	$ 20,171,868	$ 19,186,391
Percentage of revenue more than Company's total revenue	10.00%	10.00%
International
Revenues	$ 14,144,975	$ 12,650,195
Music Publishing
Revenues	24,000,293	20,791,315
Music Publishing \| United States
Revenues	13,789,192	13,000,994
Music Publishing \| International
Revenues	10,211,101	7,790,321
Recorded Music
Revenues	9,630,504	10,384,637
Recorded Music \| United States
Revenues	5,696,630	5,524,763
Recorded Music \| International
Revenues	3,933,874	4,859,874
Other revenue
Revenues	686,046	660,634
Other revenue \| United States
Revenues	686,046	660,634
Digital \| Music Publishing
Revenues	14,634,703	11,900,517
Digital \| Recorded Music
Revenues	6,558,170	5,622,649
Performance \| Music Publishing
Revenues	5,134,426	4,514,904
Synchronization \| Music Publishing
Revenues	2,811,017	3,032,699
Synchronization \| Recorded Music
Revenues	613,643	328,290
Mechanical \| Music Publishing
Revenues	668,973	559,647
Physical \| Recorded Music
Revenues	1,352,341	3,574,551
Neighboring rights \| Recorded Music
Revenues	1,106,350	859,147
Other \| Music Publishing
Revenues	$ 751,174	$ 783,548

REVENUE RECOGNITION - Change in deferred revenue (Details) - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
REVENUE RECOGNITION
Balance at beginning of period	$ 1,163,953	$ 2,151,889
Cash received during period	933,713	493,290
Revenue recognized during period	(995,405)	(1,189,250)
Balance at end of period	$ 1,102,261	$ 1,455,929

ACQUISITIONS (Details) - USD ($)	3 Months Ended
ACQUISITIONS (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
Publishing and recorded music catalogs
ACQUISITIONS
Total consideration transferred	$ 801,315	$ 15,623,951

INTANGIBLE ASSETS (Details) - USD ($)	3 Months Ended
INTANGIBLE ASSETS (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023	Mar. 31, 2024
Intangible assets subject to amortization:
Gross intangible assets	$ 771,406,318		$ 770,560,706
Accumulated amortization	(136,681,446)		(130,338,706)
Intangible assets, net	634,724,872		640,222,000
Amortization expense	6,326,863	$ 5,997,512
Publishing and recorded music catalogs
Intangible assets subject to amortization:
Gross intangible assets	770,493,046		769,648,966
Artist management contracts
Intangible assets subject to amortization:
Gross intangible assets	$ 913,272		$ 911,740

ROYALTY ADVANCES (Details) - USD ($)	3 Months Ended
ROYALTY ADVANCES (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
ROYALTY ADVANCES
Balance at beginning of period	$ 69,775,565	$ 66,926,500
Additions	2,396,796	6,199,316
Recoupments	(8,507,595)	(3,239,056)
Balance at end of period	$ 63,664,766	$ 69,886,760

SECURED LINE OF CREDIT - Schedule of long-term debt (Details) - USD ($)	Jun. 30, 2024	Mar. 31, 2024
Long-term Debt, by Current and Noncurrent
Debt issuance costs, net	$ (4,701,016)	$ (5,036,803)
Long-term portion	324,127,393	330,791,607
Secured loan
Long-term Debt, by Current and Noncurrent
Secured line of credit	$ 328,828,409	$ 335,828,410

SECURED LINE OF CREDIT - Credit Facilities (Details)		3 Months Ended
SECURED LINE OF CREDIT - Credit Facilities (Details)	Dec. 16, 2022 USD ($)	Jun. 30, 2024 USD ($)	Mar. 31, 2024 USD ($)
SECURED LINE OF CREDIT
Debt Issuance Costs, Net		$ 4,701,016	$ 5,036,803
RMM credit agreement
SECURED LINE OF CREDIT
Aggregate amount	$ 450,000,000
Margin (in percent)	0.25%
Unused fee (in percent)		0.25%
Fixed charge coverage ratio		1.10
Consolidated senior debt to library value ratio		0.45
New Senior Credit Facility
SECURED LINE OF CREDIT
Borrowing capacity		$ 450,000,000
Remaining borrowing availability		$ 121,171,591
Base rate \| RMM credit agreement
SECURED LINE OF CREDIT
Margin (in percent)	1.00%
SOFR \| RMM credit agreement
SECURED LINE OF CREDIT
Margin (in percent)	2.00%
Maximum \| RMM credit agreement
SECURED LINE OF CREDIT
Additional commitments	$ 150,000,000

SECURED LINE OF CREDIT - Interest Rate Swaps (Details) - Senior Credit Facility	Jun. 30, 2024 USD ($)
Interest rate swaps
SECURED LINE OF CREDIT
Notional Amount	$ 7,625,000
Pay Fixed Rate (in percent)	1.533%
Interest rate swap one
SECURED LINE OF CREDIT
Notional Amount	$ 87,501,612
Pay Fixed Rate (in percent)	1.422%
Interest rate swap two
SECURED LINE OF CREDIT
Notional Amount	$ 54,873,388
Pay Fixed Rate (in percent)	0.972%
Interest rate swap three
SECURED LINE OF CREDIT
Notional Amount	$ 100,000,000
Pay Fixed Rate (in percent)	2.946%
Interest rate swap four
SECURED LINE OF CREDIT
Notional Amount	$ 50,000,000
Pay Fixed Rate (in percent)	3.961%

INCOME TAXES (Details) - USD ($)	3 Months Ended
INCOME TAXES (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
INCOME TAXES
Income tax (benefit) expense	$ (293,968)	$ 62,348
Effective tax rate (in percent)	39.30%	27.50%
Deferred tax liabilities related international intangible assets	$ 103,000

SUPPLEMENTARY CASH FLOW INFORMATION (Details) - USD ($)	3 Months Ended
SUPPLEMENTARY CASH FLOW INFORMATION (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid	$ 4,842,444	$ 4,333,987
Income taxes paid	44,212	58,157
Acquired intangible assets included in other liabilities		1,355,000
Reclassification of liability-classified awards to equity-classified awards	$ 722,500	$ 664,167

WARRANTS (Details) - Warrants		3 Months Ended
WARRANTS (Details) - Warrants	Dec. 15, 2020 shares	Jun. 30, 2024 D $ / shares shares
WARRANTS
Number of warrants outstanding \| shares		5,750,000
Number of warrants sold \| shares	137,500
Number of shares issuable per warrant \| shares		1
Exercise price of warrants \| $ / shares		$ 11.50
Warrants expiration term (in years)		5 years
Redemption price per public warrant (in dollars per share) \| $ / shares		$ 0.01
Minimum threshold written notice period for redemption of public warrants		30 days
Stock price trigger for redemption of public warrants (in dollars per share) \| $ / shares		$ 18.00
Threshold trading days for redemption of public warrants		20 days
Threshold consecutive trading days for redemption of public warrants		30 days
Threshold number of business days before sending notice of redemption to warrant holders \| D		3

SHARE-BASED COMPENSATION (Details) - USD ($)	3 Months Ended
SHARE-BASED COMPENSATION (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
SHARE-BASED COMPENSATION
Share-based compensation expense	$ 1,273,674	$ 914,426
Share-based compensation expense net of taxes	990,251	704,234
Restricted Stock Units (RSUs) \| Additional Paid-in Capital
SHARE-BASED COMPENSATION
Accounts payable and accrued liabilities to additional paid-in capital	$ 722,500	$ 664,167

(LOSS) EARNINGS PER SHARE - Basic and Diluted (loss) Earnings Per Share (Details) - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Basic (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$ (346,655)	$ 277,333
Weighted average common shares outstanding - basic	64,970,693	64,572,432
(Loss) earnings per common share - basic	$ (0.01)
Diluted (loss) earnings per common share
Net (loss) income attributable to Reservoir Media, Inc.	$ (346,655)	$ 277,333
Weighted average common shares outstanding - basic	64,970,693	64,572,432
Weighted average effect of potentially dilutive securities:
Effect of dilutive stock options and RSUs		426,112
Weighted average common shares outstanding - diluted	64,970,693	64,998,544
(Loss) earnings per common share - diluted	$ (0.01)

(LOSS) EARNINGS PER SHARE - Additional information (Details) - shares	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
EARNINGS PER SHARE
Anti-dilutive effect of common shares	7,799,897	5,953,199
RSU's
EARNINGS PER SHARE
Anti-dilutive effect of common shares	635,065
Warrants
EARNINGS PER SHARE
Anti-dilutive effect of common shares	5,887,500	5,887,500
Employee Stock Option
EARNINGS PER SHARE
Anti-dilutive effect of common shares	1,277,332	65,699

FINANCIAL INSTRUMENTS (Details) - Level 2 - Interest rate swaps - USD ($)	3 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Mar. 31, 2024
FINANCIAL INSTRUMENTS
Fair value of the outstanding interest rate swaps - asset	$ 5,141,819		$ 5,753,488
Fair value of the outstanding interest rate swaps - liability			$ 121,374
Gain (loss) on changes in fair value of derivative instruments	$ (490,295)	$ (1,845,387)

CONTINGENCIES AND COMMITMENTS (Details)	Jun. 30, 2024 USD ($)
CONTINGENCIES AND COMMITMENTS
Provision for any contingent liabilities	$ 0

SEGMENT REPORTING (Details)	3 Months Ended
SEGMENT REPORTING (Details)	Jun. 30, 2024 segment
SEGMENT REPORTING
Number of reportable segments	2

SEGMENT REPORTING - Total revenue (Details) - USD ($)	3 Months Ended
SEGMENT REPORTING - Total revenue (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
SEGMENT REPORTING
Total revenue	$ 34,316,843	$ 31,836,586
Reconciliation of OIBDA to operating income:
Operating income	4,961,533	3,144,921
Amortization and depreciation	6,384,757	6,055,568
OIBDA	11,346,290	9,200,489
Music Publishing
SEGMENT REPORTING
Total revenue	24,000,293	20,791,315
Reconciliation of OIBDA to operating income:
Operating income	2,182,422	1,396,472
Amortization and depreciation	4,601,128	4,302,844
OIBDA	6,783,550	5,699,316
Recorded Music
SEGMENT REPORTING
Total revenue	9,630,504	10,384,637
Reconciliation of OIBDA to operating income:
Operating income	2,691,278	1,763,796
Amortization and depreciation	1,759,822	1,729,152
OIBDA	4,451,100	3,492,948
Other
SEGMENT REPORTING
Total revenue	686,046	660,634
Reconciliation of OIBDA to operating income:
Operating income	87,833	(15,347)
Amortization and depreciation	23,807	23,572
OIBDA	$ 111,640	$ 8,225

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