Beyoncé label in crisis
THE world's biggest independent record label today warned that its profits had collapsed after a series of disastrous delays to record releases.
Sanctuary, home to artists ranging from Elton John and Morrissey to Destiny's Child and Beyoncé, faces serious concerns about its future and businesses may be sold off to deal with the crisis.
Sanctuary is buckling under nearly £118m of borrowings, higher than the company forecasts and more than it is 'comfortable with going forward,' the company said in a statement accompanying annual figures today.
The music group, based in Hammermith, West London, may even be sold off in its entirety to a larger rival such as EMI.
Sanctuary was founded in the Seventies by Cambridge undergraduates Andy Taylor and Rod Smallwood, who hit the big time when they discovered heavy metal band Iron Maiden in a pub in 1979. The band went on to worldwide success.
But today Mr Taylor, executive chairman, confirmed that £9.3m had been wiped from Sanctuary's expected turnover in the first half of trading to the end of March after 'slippage from releases' caused a shortfall of 1.3m unit sales.
Sanctuary slumped to losses of £2.18m compared with £3.8m of pre-tax profits this time last year, and the label said it was embarking on a cost savings plan of 'at least £7m to £8m.'
Mr Taylor said: 'I am clearly disappointed that set-backs within the recorded product releases have resulted in a lack of growth in the business.'
