stim annual report 2014

ANNUAL REPORT

2014

77 6291 359 407

1,7

18%8,5

1923

30 000 000

TOTAL OPERATING INCOME IN SWEDEN AND ABROAD 1.7 BILLION

NUMBER OF STIM AFFILIATES 77,629 – AN INCREASE OF 45 PERCENT IN 7 YEARS

NUMBER OF NOTIFIED WORKS WITH AT LEAST ONE STIM-AFFILIATED AUTHOR 1,359,407

8.5 MILLION ALLOCATED FOR SCHOLARSHIPS

ALLOCATES SEK 30 MILLION ANNUALLY FOR EFFORTS TO PROMOTE MUSIC

STIM FOUNDED 1923

Did you know that STIM…

• is the Swedish performing rights society (Svenska Tonsättares Internationella Musikbyrå).• is owned by those who create music and music publishers.• is a non-profit incorporated society.• works on behalf of its affiliated authors and music publishers.• defends their economic interests in accordance with copyright legislation.• also acts on behalf of counterpart organizations in other countries.• issues licenses to those who wish to use and distribute music.• collects license fees.• distributes the remuneration to creators and music publishers on an individual basis.• promotes Swedish music culture.

REVENUE FROM ONLINE PERFORMANCE HAS INCREASED BY 18 PERCENT COMPARED TO 2013

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1 359 40718%

1923

30 000 000Did you know that STIM…

• is the Swedish performing rights society (Svenska Tonsättares Internationella Musikbyrå).• is owned by those who create music and music publishers.• is a non-profit incorporated society.• works on behalf of its affiliated authors and music publishers.• defends their economic interests in accordance with copyright legislation.• also acts on behalf of counterpart organizations in other countries.• issues licenses to those who wish to use and distribute music.• collects license fees.• distributes the remuneration to creators and music publishers on an individual basis.• promotes Swedish music culture.

STIM in figures 8 02

Collective strength 8 05

The STIM process from license to distribution 8 06

1.4 billion to members 8 08

Sweden’s thirteenth city 8 12

In the big, wide world 8 15

Songs with the most revenue from abroad 2014 8 16

STIM – balance of payments with foreign counterparts 8 18

Annual scholarships 8 20

Broader lineups, new target groups, and better attendance 8 22

Broad cultural support and publishing 8 24

New pricing models for a digital world 8 27

Background to the fore 8 28

Equality among personnel and unified IT support 8 30

The Board of Director 8 32

The STIM sphere 8 33

STIM’s committees 8 38

Administration Report 8 40

Notes 8 51

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Collective strength

We believe in the strength of the non-profit, collective management of our members’ rights. But this is a model that now faces compe-tition and must never be taken for granted. This was clearly seen in 2014 and we must continually adapt if we are to remain relevant.

STIM is owned by its affiliated authors and music publishers and our role is to ensure that composers and lyricists get paid when their music is used. 2014 saw record numbers of STIM-affiliated authors and music publishers, we collected fees for more works than ever before, and – not least – we distributed the most money ever to our rightsholders. Our members also enjoyed a successful year. Live music in Sweden set new records, for festivals and individual concerts alike, while Swedish art music and pop music enjoyed success in the charts and as the recipients of international awards. The rapid technological changes we’ve seen in the market continued, and STIM is working continually to find pricing models to suit the market and increase revenue for our affiliated authors. Take, for example, conventional TV viewing, which fell in favor of video on demand services for the first time, and streaming music, which continued to rise. Despite a successful year, current and future circumstances remain increasingly unsure and uncertain. Globalization and digitization are changing our world at a rate that makes it hard to keep up. We believe that STIM’s collective model is the best way to secure the value of music in the long term, and as such we must also adapt if we are to remain a viable option for our rightsholders and for those who use music to enrich people’s lives. 2014 was a year in which STIM continued its change process and in many ways set the stage for the future. We refined our organization, held several meetings with our mem-bers to discuss issues such as increased transparency, and I took over as CEO in August. Looking to the future is an exciting prospect. One of our key pointers for 2015 is cooperation. We will cooperate with the organiza-tions that own us, namely FST, SKAP and Musikförläggarna, and we will cooperate with our members and affiliates so as to prevent a decline in the value of music. Moreover, we will cooperate with our fellow organizations in Germany, the UK, and the Nordics to considerably improve the collective management of music rights.

Karsten Dyhrberg Nielsen, Chief Executive Officer

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Digital services (in Sweden and even certain services in Europe, so-called direct licensing).Music reports on the number of streams/views.

REPRODUCTION OF RECORDINGS (mechanical reproductions for the entire Nordic region, administered by NCB)Issuers of DVDs, CDs, downloads, etc. Reports on copies produced and sales figures.

PUBLIC PERFORMANCESOperations that use music publicly (radio, TV, stores, restaurants, events, concerts, etc.). Music reports from music users.

ABROADSTIM’s international counterparts collect money, identify STIM-affiliated rightsholders, and send reports and money to STIM as regards the above. STIM then distributes the money to the right author and, in applicable cases, the music publisher too without any administrative deductions.

IDENTIFICATION MATCHING

Royalty payments to authors and music publishers are based on reports on which music has been played, recorded, downloaded, or streamed. The informa-tion in the reports is linked to entries in the works register.

The STIM process from license to distribution MONEY IN

ICE STIM’s works register containing all informa-

tion about authors, music publishers, and their shares of the works.

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AUTHORS AND MUSIC PUBLISHERSSpecification of what the payment concerns, which songs are covered by the payment, the concerned music use areas, and the amount.

MONEY OUTDISTRIBUTION

The royalties are distributed according to STIM’s distribution rules and paid to the musical works’ creators and their publishers, as well as to STIM’s interna-tional counterparts, which forward the remuneration to their members. The money is distributed after all deductions for expenses, national funds, scholar-ships, and subsidies.

ROYALTY PAYMENTS

Royalty payments are made several times a year.

ABROADSTIM forwards collected money, fees, and reports to counterpart organizations in other countries, which in turn distribute the revenue to their affiliated authors and music publishers.

By becoming affiliated with STIM, authors and music publishers instruct STIM to manage their economic rights as laid down in copyright legislation. The author or publisher notifies STIM of their musical works. These are documented by being entered in the works register with details of current ownership shares. Information about foreign musical works is also entered in the works register.

STIM instructs its counterparts in other parts of the world to protect the economic rights of STIM-af-filiated members in these other territories. The remuneration is forwarded to STIM for further dis-tribution to STIM-affiliated mem-bers. Similarly, STIM represents rights to foreign music performed in Sweden.

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1.4 billion to members

More money in. More money out. That’s the easiest way to summa-rize 2014 in two simple statements. “Swedish music continues to succeed, and that means more money for the authors,” says STIM’s Finance Director Kina Paulsson.

In 2014, STIM distributed SEK 1.4 billion, which is a record – again. And almost 90 percent goes to the rightsholders. Once again, the largest increase in revenue was seen in online and new media, at just short of 18 percent. “The increase has, however, plateaued significantly compared to previous years. Parallel to this, record sales continue to decline, although we can’t really describe it as a dramatic drop,” says Kina. Revenue from abroad increased by ten percent, but that’s largely due to the weakening of the Swedish krona during the year. “If, for example, we consider revenue from live music, it appears to have fallen dramat-ically. But that’s not really the case, as some live music is now reported as background music and the accrual accounting used meant that the figure was unusually high the previous year. We always invoice live music in arrears because we have to wait for the music reports, which means an initial reliance on estimates.” Royalties are affected by the received reports and the distribution principles. In 2014, STIM invested resources in reducing payments based on analogous data and increasing actual reporting (read more on page 29). “Each year, we receive money that we cannot distribute because we lack necessary in-

formation, such as incomplete reports, no registered recipient for the money, or the lack of an established analogous data procedure to distribute the money. Distributing that money is outside our regular payment procedures, and it’s a situation we’d like to change,” says Kina.

ROYALTIES 2014

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ADMINISTRATIVE COSTS AND DEDUCTIONSThe internationally applied measure of the efficiency of copyright organizations is the so-called administrative overhead. This is the share of total revenue from music performance used to cover the organization’s adminis-trative costs, and in 2014 this figure was 9.4 percent in STIM’s case. The amount that is distributed is affected in part by the administrative costs and in part by the distribution decisions that have been made. The amount deducted from Swedish performance rights for administrative costs was SEK 156.7 million. STIM also made a deduction for so-called national funds totaling SEK 30.7 million or 1.9 percent, providing a total cost deduction of 11.3 percent for 2014. In the case of online performance, only an administrative deduction of up to 10 percent is made with no deduction for national funds. STIM’s annual general meeting decides on the alloca-tion to the annual STIM scholarships. The amount can to-tal a maximum of three percent of the money distributed to Swedish rightsholders. In the case of remuneration for performances abroad, STIM makes no administrative or other deductions. In the case of revenue from STIM affiliates’ mechanical repro-duction rights from NCB, STIM makes no administrative or other deductions. The deductions for costs are made by the international societies before the revenue reaches STIM for distribution.

Mechanical reproduction

9,6%Radio and TV

21,2%

Live music4,9%

Background music11,8%

Online and new media

16%

Private copying levy0,7%

Other revenue1,1%

International32%

International, fordistribution by STIM

2,7%

Foreign music withSTIM-alatedsub-publishers

27%

Foreign music36%

Music with STIM-aliatedauthors and music publishers

37%

STIM – DISTRIBUTABLE INCOME, SEK M 2014 2013 %Performance in Sweden 903.7 851.5 6.1%

Performance abroad 537.7 487.7 10.3%

Performance abroad for distribution by STIM 44.9 34.2 31.3%

Other revenue 53.7 35.1 53.0%

Total income 1,540.0 1,408.5 9.3%

Operating costs -196.9 -168.7 16.7%

For distribution, including national funds 1,343.1 1,239.8 8.3%

Mechanical reproduction 161.9 186.7 -13.3%

STIM – distributable income 1,505.0 1,426.5 5.5%

DISTRIBUTION OF INCOME, SEK M 2014 2013 %Distributed for performance in Sweden 727.8 682.9 6.6%

Distributed for national funds 30.7 31.3 -1.9%

Awarded scholarships 8.5 8.7 -2.3%

Distributed for performance abroad 537.7 487.7 10.3%

Distributed for performance abroad, distributed by STIM on behalf of others 38.4 29.2 31.5%

Distributed for mechanical reproduction 161.9 186.7 -13.3%

Distribution of income 1,505.0 1,426.5 5.5%

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DISTRIBUTION CATEGORY REMUNERATION DISTRIBUTED REMUNERATION IS AFFECTED BY THE CHARACTER OF THE PERFORMANCE/WORK

COLLECTED AMOUNT, SEK M

AMOUNT FOR DISTRIBUTION, SEK M

% MUSIC WITH STIM-AFFILIATED AUTHORS AND MUSIC PUBLISHERS

% FOREIGN MUSIC WITH STIM-AFFILIATED SUB-PUBLISHERS

% FOREIGN MUSIC

1 ConcertsSubsidized concerts featuring art music

Total based on all music reports for the category (joint minute value)

Grading, Categorization Large/small concert

4.2 (5.1) 3.3 (4.1) 38 (37) 16 (14) 46 (49)

2 Church concerts Total based on all music reports for the category (joint minute value), as well as on sampling reports from CCLI

Grading, sampling 2.3 (2.0) 1.8 (1.6) 53 (53) 13 (13) 34 (34)

4 Dance – Night Clubs Total based on music reports for the category from Dee-Jay Promo-tions (joint minute value)

Grading 27.4 (24.6) 21.5 (19.8) 26 (39) 30 (26) 44 (35)

5 Other live music, reportedConcerts and other live performances

Per music report (income per performance)

Grading 59.6 (57.7) 47.3 (46.5) 55 (53) 19 (21) 26 (26)

6 Other live music, not reported

Reused music reports from the category Other live music, reported

Grading and according to analogous data respectively

22.4 (44.7) 17.6 (36.0) 59 (61) 17 (16) 24 (23)

7 Theater music Per music report (income per performance)

Grading 1.1 (1.0) 0.9 (0.8) 31 (38) 28 (25) 41 (37)

8 Background music, reportedMechanically reproduced background music

Per music report (income per performance)

Grading 1.1 (1.0) 0.9 (0.8) 15 (42) 40 (27) 45 (31)

9 Background music, not reported

Reused music reports from SR, commercial radio, TV, online, and from NCB (record sales and downloads)


147.1 (133.8) 115.5 (107.8) 39 (40) 26 (26) 35 (34)

10 Swedish Radio (SR) Total based on all music reports for the category (joint minute value)

Grading 51.8 (50.7) 40.7 (40.8) 35 (37) 23 (22) 42 (41)

11 SVT (Swedish Television) Per music report (income per channel) Grading 62.6 (67.5) 49.2 (54.4) 27 (30) 25 (23) 48 (47)

12 Commercial radio Per music report (income per channel) Grading 25.7 (24.9) 20.2 (20.1) 24 (30) 35 (32) 41 (38)

13 Commercial TV Per music report (income per channel) Grading 213.1 (193.4) 171.4 (155.7) 17 (17) 32 (31) 51 (52)

14 Community radio Sampling reports from KRN, reports directly from rightsholders, and reused music reports from P4 local radio (SR)

Grading, sampling, and according to analogous data respectively

2.6 (2.8) 2.1 (2.3) 40 (41) 25 (26) 35 (33)

15 Movie theaters Per music report and film 13.9 (14.4) 11.0 (11.6) 26 (16) 31 (35) 43 (49)

16 Online, reported Per music report(income per service)

Grading 259.3 (220.6) 241.5 (199.8) 56 (51) 21 (27) 23 (22)

19 Online, not reported Reused music reports from SVT, SR, and commercial radio


9.5 (7.3) 8.5 (6.6) 27 (31) 31 (28) 42 (41)

17 Compensation for private copying

Reused music reports from TV, SR, and NCB (record sales and downloads)

According to analogous data

11.1 (11.8) 11.1 (11.8) 58 (59) 33 (31) 9 (10)

18 Library levy Borrowing statistics from libraries 2.5 (2.5) 2.5 (2.5) 99 (99) 1 (1) 0 (0)

20 & 96

International Reports from foreign collecting societies

537.7 (487.7) 537.7 (487.7) 48 (48) 52 (52) 0 (0)

21 International, for distribution by STIM

Reports from foreign collecting societies and reused music reports from TV


44.9 (34.2) 38.4 (29.2) 10 (6) 55 (47) 35 (37)

NCB Mechanical reproduc-tion rights

Reports from NCB regarding record sales and downloads in the Nordics and Baltics

161.9 (186.7) 161.9 (186.7) 45 (45) 55 (55) 0 (0)

DISTRIBUTION PER REVENUE CATEGORY 2014 (2013)*

Note: Grading has no effect on mechanical reproduction rights or in film. *) Read more about analogous data distribution on page 29.

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TOVE LOTove began her career as a songwriter in 2011 when she started working with Warner Chappell. In the fall of 2014, she climbed all the way to number three of the Billboard Hot 100 with the song Habits (Stay High).

One favorite album:LORDEPURE HEROINE

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Sweden’s thirteenth city

74,403 authors and 3,226 music publishers. That’s how many affil-iates STIM had at the end of December 2014. Together, these two groups could fill Stockholm’s Globen concert venue five times over or form Sweden’s thirteenth largest city, if for some reason they should want to live together.

Perhaps the best way to illustrate the extent of STIM’s work is in figures. In 2014, for example, royalties were paid for a total of 1,323,013 musical works in STIM’s distribution process. That’s an increase of more than 160,000 works over the previous year. “As a comparison, the figure for 2000 was 220,000 works, which is just a sixth of the volume handled today. This is down to the introduction of digital music services, which enable us to listen to hundreds of unique works every day. That wasn’t possible fifteen years ago,” says Robert Gehring, Head of STIM’s Member Service. “Our service mandate also includes providing support to our affiliates. Last year, we re-ceived about 20,000 e-mails and 13,000 phone calls from our affiliated authors, music publishers, and the general public.” In 2014, 3,180 authors and 101 music publishers joined STIM. Foreign rightsholders are also increasing in number – last year STIM had 1,076 members and music publishers domiciled abroad in 67 different countries. The percentage of new female members has also increased, from 22.4 to 25.6 percent. All in all, almost 20 percent of STIM’s members are female. And the number of authors receiving more than SEK 100,000 a year from STIM has increased by 12 percent compared to 2011. “Today, STIM is bigger than ever. And these figures also show the confidence we’ve inspired in music creators throughout the world. Not to mention the resulting respon-sibility that falls to us. As such, we’ve invested a great deal of energy in listening to our members this past year. Among other things, in September STIM held a dialog meeting on STIM’s international cooperation, analogous royalties, and future challenges. STIM also publishes the periodical STIM-Magasinet four times a year, and has conducted a pilot study on how to best develop the ‘My Pages’ online service.” “This past year, we’ve focused a great deal on how we distribute the money, and we’ve prepared an extensive survey on which music sources customers use in their operations, as well as which channels, music suppliers, and online services are used.” Music surveys are important if the analogous data is to reflect the actual use of music in cases where we cannot obtain detailed reports. One of the highlights of the year was the STIM Music Expo event, which almost 800 com-posers, lyricists, music publishers, and music students attended for advice and inspiration. “This was the sixth time we’ve arranged the event and it’s become an important meeting place for the entire music industry – not just affiliated songwriters and music publishers,” says Robert.

OUR RIGHTSHOLDERS

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STIM MUSIC EXPO 2014

Almost 800 songwriters, musicians, and other members of the music industry congregated at the STIM Music Expo event at the beginning of November.

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ADAM NORDÉNAdam is one of our most acclaimed composers for film, TV, and advertising. He’s received a Swedish Guldbagge Award and a prize at the international TV festival in Reims, France.

Recently, I’ve been listening to a lot of:GREGORY PORTERLIQUID SPIRIT

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In the big, wide world

Swedish music continues to reap great success abroad – not least in the market many consider the toughest to break: America The US. Swedish songwriters topped the Billboard Hot 100 during fourteen of the year’s 52 weeks, and in art music Swedish composers saw international success.

No fewer than 114 weeks in the top ten, more than 340 weeks in the top one hundred, and 14 weeks at number one for a total of 20 songs. These are a few of the figures that illustrate Swedish dominance in the Billboard chart last year. At most, STIM-affiliated songwriters had five songs in the top ten at the same time, and eleven songs among the top one hundred. “Max Martin also received his first American Grammy in 2014, for Producer of the Year. He’s had 19 songs top the Billboard chart – and only Paul McCartney and John Lennon have bettered that. So he’s in good company,” says Sara Kilander, STIM’s Head of Operations. Furthermore, Tim “Avicii” Bergling had a number one hit in England with David Guet-ta’s Lovers on the Sun, and Mats Tärnfors and Andreas Stone Johansson each had a song on Japanese band Arashi’s best-selling album The Digitalian. As expected, Swedish songwriters were well represented in the Eurovision Song Contest – at the final in Copenhagen no fewer than six entries were penned by STIM-affiliated authors. “There’s almost no end to the success enjoyed by Swedish music,” says Sara. “Max Martin, Icona Pop, and Swedish House Mafia all received awards at the American copyright organization ASCAP’s annual awards show, Erik Hassle was one of the writers on Shakira and Rihanna’s duet Can’t Remember to Forget You, and Tove Lo was the first Swedish artist in 20 years to reach the number three spot of the Billboard Hot 100 chart, with the song Habits (Stay High).” The total number of STIM-affiliated songwriters with overseas income in excess of SEK 100,000 has also increased, to 243 people compared to 215 people in 2013. “This figure has increased every year for the past fifteen years, which is fantastic devel-opment. And we continue to work for better pay for the authors,” says Sara. Swedish contemporary art music is in demand in Sweden, Europe, Asia, and the USA. Ylva Q Arkvik, Lars Bröndum, Malin Bång, Thomas Jennefelt, Victor Lisinski, Miklós Ma-ros, Fabian Svensson, and Henrik Denerin are a few of the composers that have achieved great success abroad. “Henrik Denerin’s works were performed in France, Poland, Germany, Japan, and the USA. And several of Sven-David Sandström’s works were performed last year, including his Matteuspassion for nine soloists, a choir and an orchestra in Berlin,” says Sara. “Karin Rehnqvist and Claes Holmgren’s Klockrent – En Mycket Stor Konsert won first prize at Prix Italia and fourth place at Prix Europa, while Rolf Martinsson was appointed Composer in Residence for the Netherlands Philharmonic and Chamber Orchestras.”

STIM INTERNATIONALLY

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Several Swedes also proved a great success at major international festivals. Works by Paula af Malmborg Ward, Sten Melin, and Henrik Strindberg were enthusiastically received at Dark Music Days in Reykjavik. And Classical NEXT in Vienna featured works by Emil Råberg, Lisa Stenberg, Björn Sikström, Mirjam Tally, Anna Eriksson, Anders Hul-tqvist, and Mattias Petersson. “One of the best highs of the year was in London on June 13, when the BBC Symphony Orchestra performed Transit Underground by Tobias Broström and Symphony No 2 … sunt lacrimae rerum … by Mats Larsson Gothe. The same concert also featured Hugo Alfvén’s suite from Bergakungen and piano music by Ture Rangström. All of them received rave reviews in the English press,” says Gustaf Bergel, head of operations at Svensk Musik. The success of Swedish authors is one of the reasons behind STIM’s international work, which is conducted on several fronts. STIM’s reputation as a credible and reliable organi-zation has spread way beyond Sweden’s borders – among both rightsholders and other industry stakeholders. “STIM and British PRS for Music own the joint venture company and music database ICE Services AB. In 2015, the other Nordic countries together with Iceland, the Baltics, and NCB plan to start using ICE,” says Sara. “Buma/Stemra is already a customer.” In order to uphold its affiliated members’ rights, STIM is focusing on the direct licensing of digital music services in Europe. In 2014, STIM and its British and German counter-parts, PRS for Music and GEMA, continued their plans to cooperate on simplifying the licensing and handling of both national and pan-European music rights. The collective repertoire will be one of the largest in Europe, with several million works available for download, subscription, and streaming services. “The matter is currently under the scrutiny of the EU as regards antitrust. They’ll pro-vide a verdict in July 2015, so hopefully joint direct licensing can become a reality after that,” says Sara.

TITLE AUTHORS ARTIST

Don’t You Worry Child Hedfors, A/Ingrosso, S/Angello, S/Lindström, M/Zitron, M Swedish House Mafia

I Knew You Were Trouble Swift, T/Martin, M/Shellback Taylor Swift

I Love It Eklöw, L/Berger, P/Aitchison, C Icona Pop

Wake Me Up Bergling, T/Dawkins, E/Einziger, M Avicii

One More Night Shellback/Martin, M/Kotecha, S/Levine, A Maroon 5

Hey Brother Bergling, T/Pontare, V/Al Fakir, S/Maggio, V/Pournouri, A Avicii

Reckoning Song Avidan, A/Kleinman, H/Nir, R/Peled, R/Sheleg, Y/Winokur, O Asaf Avidan & The Mojos

I Follow Rivers Zachrisson, LL/Yttling, B/Nowels, R Lykke Li

I Could Be The One Vredenberg, M/Pournouri, A/Rotteveel, N/Bergling, T/Parmenius, J/Wiklund, L Avicii, Nicky Romero

Roar McKee, B/Walter, H/Perry, K/Martin, M/Gottwald, L Katy Perry

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Songs with the most revenue from abroad 2014(WITH AT LEAST ONE STIM-AFFILIATED AUTHOR)

MALIN BÅNGMalin began studying composition in 1993 and received her Master’s from the Royal College of Music in Stock-holm eleven years later. Today, she’s resident composer for the German ensemble Curious Chamber Players.

One favorite album:One of my absolute favorite albums is APARELHAGEM by Brazilian DJ DOLORES and ORCHESTRA SANTA MASSA.

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STIM – BALANCE OF PAYMENTS WITH FOREIGN COUNTERPARTS, SEK THOUSAND (FIGURES FOR 2013 IN PARENTHESES)

Finland 84,648 (80,032) 72,661 (68,055) 11,987 (11,978) 4,562 (4,635)

Denmark 184,697 (148,553) 157,816 (126,653) 26,880 (21,900) 9,677 (11,275)

Iceland 3,017 (2,072) 2,820 (1,949) 196 (123) 359 (291)

Norway 52,961 (60,298) 41,639 (46,290) 11,322 (14,008) 6,184 (6,967)

Estonia 1,697 (2,131) 1,551 (1,960) 146 (171) 113 (103)

Latvia 0 (2,224) 0 (2,030) 0 (194) 58 (45)

Lithuania 9,660 (0) 8,234 (0) 1,427 (0) 33 (27)

Total Nordics & Baltics 336,680 (295,310 284,721 (246,936) 51,958 (48,374) 20,986 (23,342)

Belgium 4,127 (4,303) – – 4,127 (4,303) 633 (446)

France 15,996 (14,697) – – 15,996 (14,697) 9,761 (10,385)

Greece 1,873 (490) – – 1,873 (490) 187 (284)

Ireland 1,249 (2,102) – – 1,249 (2,102) 893 (585)

Israel 942 (748) – – 942 (748) 132 (81)

Italy 10,064 (6,763) – – 10,064 (6,763) 2,280 (2,957)

Netherlands 10,534 (11,110) – – 10,534 (11,110) 5,873 (3,963)

Poland 2,699 (2,524) – – 2,699 (2,524) 174 (213)

Portugal 559 (706) – – 559 (706) 67 (70)

Romania 935 (1,512) – – 935 (1,512) 172 (9)

Russia 918 (1,949) – – 918 (1,949) 239 (299)

Switzerland 4,938 (3,778) – – 4,938 (3,778) 756 (725)

Slovakia 375 (351) – – 375 (351) 27 (26)

Spain 5,043 (4,740) – – 5,043 (4,740) 1,413 (1,999)

UK 30,641 (25,054) – – 30,641 (25,054) 50,015 (50,409)

Czech Republic 634 (629) – – 634 (629) 130 (185)

Germany 31,876 (23,461) – – 31,876 (23,461) 8,445 (7,969)

Hungary 1,189 (1,490) – – 1,189 (1,490) 134 (94)

Austria 4,240 (4,095) – – 4,240 (4,095) 895 (811)

Rest of Europe 788 (1,260) – – 788 (1,260) 239 (192)

Total Europe (excl. Nordics & Baltics)

129,620 (111,762)– (–)

129,620 (111,762) 82,466 (81,701)

Argentina 1,112 (1,159) – – 1,112 (1,159) 40 (548)

Australia 8,280 (9,368) – – 8,280 (9,368) 6,375 (5,407)

Brazil 5,270 (3,698) – – 5,270 (3,698) 244 (979)

Hong Kong 416 (322) – – 416 (322) 19 (9)

Japan 8,006 (7,380) – – 8,006 (7,380) 332 (254)

Canada 5,511 (6,559) – – 5,511 (6,559) 5,331 (6,022)

Korea 1,504 (831) – – 1,504 (831) 88 (270)

Mexico 1,029 (739) – – 1,029 (739) 171 (0)

Singapore 748 (584) – – 748 (584) 7 (3)

South Africa 1,148 (1,384) – – 1,148 (1,384) 116 (328)

USA 38,666 (49,382) – – 38,666 (49,382) 122,404 (117,096)

Other 2,737 (1,283) – – 2,737 (1,283) 551 (519)

Total rest of the world (excl. Europe, Nordics & Bal-tics) 74,426 (82,688) – (–) 74,426 (82,688) 135,680 (131,435)

Total 540,726 (489,760) 284,721 (246,936) 256,005 (242,824) 239,132 (236,478)

COUNTRIES TOTAL FROM ABROADOF WHICH SUB-PUBLISHER REVENUE FOR FOREIGN MUSIC

OF WHICH REVENUE FOR SWEDISH MUSIC ABROAD TO ABROAD

compared to 2013

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SEK

540,726,520

+10%

8%62%

24% 2%

2%

2%

Total foreign revenue

compared to 2013

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Annual scholarships

Every year, STIM earmarks three per cent of its members’ Swedish royalties for scholarships. Only STIM-affiliated authors are eligible to apply for such scholarships, which are awarded once a year. Of schol-arship funds totaling SEK 8.5 million for 2014, SEK 4.9 million was allocated to STIM scholarships while the remaining SEK 3.6 million was divided equally between FST and SKAP.

Beste, AnsgarEngdahl Hamilton, SvenFilipsson, JensHumlén, JoelLundgren, FilipLörstad, HenrikMårtensson, HugoSimmerud, PatricAmsler, Katrine Arkbro, Ellen Augustsson,Mikael Baars, Girilal Bartonek, Anders Berg,Christoffer Björklund, Claes Bodén, Ulrika Brunnberg, Jesper Byström, Britta Cissoko, Maher Diakité, Jason Duncanson, Johan Egland, Per Forsberg, Marta Franzén, ElinFrid, Karl Frid, Pär Furbacken, Victor Gefors, Hans Gorgis, Daniel Gran, Fredrik Granberg, Magnus Groundstroem, Max Hasselquist Jarl, Joakim

Hellström, Pontus Holmlander, Per-Åke Härdig, Sofia Hörnberg, Tomas Jernberg,SofiaJohansson, Emil Jones, Adrian Jonsson, Lena Kallerdahl, Fabian Kallerdahl, Lindha Karlsson,Daniel Kentros, George Koitzsch,Jimmy Krumlinde, Jerker Krunegård, Markus Lamu, Robert Larsson Knobel, Halina Larsson Sander, Ellekari Lee, Jonna Liftig, Vanessa Lind, PontusLindh, LarsLindvall, Robin Löfgren, Lisa Mases, Petra Matzols Arkö, Björn Moir, Casey Möller, Frans Neib, Isabel Nilsson, Anders Nkolina Mvemba, José Norudde, Anders Nurulla-Khoja, Farangis

Nygårdh, Petter Olenius, Adam Olsson, Linnea Olsson, Rickard Ottander, Niklas Parkman, Sara Persson, Cecilia Pfannenstill, Andreas Rosén, Canan Rosenquist, Tim Samuelsson, Maja Sandgren, Joakim Shalan Ottosson, AlexanderSjöö, Joel Skarin, JesperSpada, Julia Stenberg, Lisa Stenström, Thomas Strand, Marlene Svensson, Johan Söderlund, Andreas Ternheim, Anna Thurfjell, Lovisa Tian, Leilei Tilliander, Andreas Valfridsson, Jonas Wennerberg Wickman, Felix Verbaan, Karin Willemark, Lena von Malmborg, Ann-Karin Zetterberg,Torbjörn Ågren,Morgan Öberg, Linn

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STIM SCHOLARSHIPS 2014

One of the highlights of the year is when STIM gets to hand out scholarships on its own premises. Many of this year’s scholarship recipients came to our offices to accept their diplomas in person and to meet other creators.

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Broader lineups, new target groups, and better attendanceBig, bigger, biggest. 2014 was the year when live music records were broken one after another. “Biggest across the board was Håkan Hellström’s concert at Ullevi in Gothenburg this past summer, with 68,000 people in attendance. Never before in Sweden have that many people been gathered to see a music event,” says Sara Kilander, STIM’s Head of Operations.

Interest in live music in Sweden continues to grow. The ten biggest festivals broke atten-dance records and the money collected by STIM totaled almost SEK 7.3 million – which is also more than ever. “For the most part, the high profile festivals were the ones that attracted a lot of people. Bråvalla sold 57,000 tickets while 49,000 people attended the one-day STHLM Fields festival. Both figures are records,” says Sara. A trend seen in 2014 was for the major festivals to offer broader lineups than in the past. House music, for instance, has gained a stronger footing and is featured at festivals aimed at broader target groups. There are still niche festivals, such as Sweden Rock, but for attracting a really big audience a mixed lineup seems to be a winning concept. The existing festival audience doesn’t disappear while new groups join them, such as many people born in the 1940s and 50s. “The major festivals have the greatest opportunity to book the most popular acts, while the medium-sized and smaller festivals more often focus on Swedish and local music,” says Sara. One bad year can be enough to bring a festival to an end. During the year, Furuvik Reggae Festival, Popadelica, and Hultsfred all disappeared, while STHLM Fields, Sónar Stockholm, and Yard Festival had their premieres. The ten commercial festivals with the highest attendances were Bråvalla, Sweden Rock, Way Out West, STHLM Fields, Summerburst Stockholm, Summerburst Gothenburg, Storsjöyran, Emmabodafestivalen, Stockholm Music & Arts, and Kentfest. 2014 was also a successful year for Swedish art music. In total, 169 STIM-affiliated com-posers had 339 works performed throughout the year, which is a significant increase. This figure is also higher in reality as not all performances are reported to Svensk Musik. “We have composers who had as many as eight works performed during the year, both in Sweden and abroad,” says Gustaf Bergel, head of operations at Svensk Musik. The year’s successful authors included Katarina Leyman, Miriam Tally, Andrea Tarrodi,

LIVE MUSIC

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MATS LARSSON GOTHEMats has composed for many different genres and had his first major break with the opera Poet & Prophetess, which premiered at NorrlandsOperan in 2008. In June, the BBC Symphony Orchestra performed his second symphony.

One favorite album:GUSTAV MAHLERSYMPHONY NO. 10 VIENNA PHILHARMONIC Conductor: Daniel Harding Record label: Deutsche Gram-mophon Released: 2008

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Paula af Malmborg Ward, Sven-David Sandström, Vladimir Levitt, Johan-Magnus Sjöberg, Henrik Denerin, Martin Larsson, Benjamin Staern, Mats Larsson Gothe, and Lars Bröndum. “All of these authors had new works performed in 2014, and almost all of them were commissioned pieces. STIM supports them with travel grants administered by Svensk Musik and via the promotion committee’s efforts to extend the reach of Swedish music.” Festivals during the year included Sound of Stockholm, the Båstad Chamber Music Fes-tival, Signal in Gävle, and the Composers Festival with Anders Hillborg. Many established composers wrote works specially for these festivals.

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Broad cultural support and publishingSTIM = money. For many people, STIM is quite simply the organiza-tion that ensures that songwriters and composers are paid for the use of their music. But STIM also helps keep Swedish culture diverse, such as by publishing works and supporting copyright-protected music projects.

STIM is able to allocate up to ten percent of Swedish revenue (after deductions for costs) to increase the awareness, availability, and performance of contemporary Swedish music. This is achieved through, for example, the subsidiary Svensk Musik Swedmic AB, which in 2014 invested SEK 6.3 million in Swedish music. “Music publishers are not able to publish everything written by STIM-affiliated compos-ers. As such, each year we receive about 400 manuscripts from STIM-affiliated compos-ers and market them by selling or leasing the works to artists, ensembles, and orchestras throughout the world. When new orchestral works are to be performed, we finance and manage the printing of complete orchestral scores,” says Gustaf Bergel, head of opera-tions at Svensk Musik. In 2014, Svensk Musik ensured that 30 different works were performed, comprising six-teen orchestral works, six operas, and eight chamber music works. In the case of operas, for example, the figure is twice that of 2013. Svensk Musik has its own music score company, Edition Suecia, which last year com-pleted the final three volumes of the Swedish opera anthology. “There are seven volumes in all, and it’s kind of the crowning glory of all that we’ve published. The anthology has gained a great deal of attention both in Sweden and abroad, not least among music schools. Aside from the actual lyrics, everything is in both Swedish and English, so it’s ready for an international launch,” says Gustaf. STIM-affiliated authors can apply for travel grants in order to attend when their works are performed abroad or premiered in Sweden. Svensk Musik takes care of the adminis-tration and awarded travel grants to 82 authors in 2014.

STIM PROMOTES SWEDISH MUSIC CULTURE

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STIM’s Promotion CommitteeSTIM’s Promotion Committee works to increase the performance of copyright-protected Swedish music – across all genres – both in Sweden and abroad. This is achieved by sup-porting various projects that create the necessary conditions for future music creation. The Promotion Committee is managed by SKAP, FST, and Musikförläggarna. Fredrik Wetterqvist chairs the committee. In 2014, the Promotion Committee decided to support some forty projects, spending a total of more than six million Swedish kronor. Some of these projects were conducted last year while others will begin in 2015. “In 2014, we kicked off a major German initiative encompassing several projects to promote Swedish music in one of the most important music nations in Europe. By con-ducting many projects in the same country, we believe that we’ll achieve better results than if we spread our resources more thinly,” explains STIM’s Project Coordinator Mattias Franzén. The German projects include a major art music manifestation at the Swedish embassy in Berlin and a meeting between Swedish film music composers and representatives from the German film industry. “Another ongoing initiative, and one which I believe can prove successful, is ‘My five Swedish Favorites’, in which prominent German culture journalists have written articles about Swedish music and created public playlists. This project doesn’t cost much money, but helps underpin the image of Swedish music as a relevant art form. The playlists include everything from Roxette to Lars-Erik Larsson.” A few other projects that the Promotion Committee supported during the year include the noted podcast Skaparna (The Creators), in which female music creators were inter-viewed, and a project that enabled Swedish music scores to be presented at the music convention in Frankfurt. “Young Nordic Music, which presented newly composed Swedish art music at high schools in Skåne, the marketing of Swedish composers in conjunction with the Stock-holm Jazz Festival, and an initiative involving cross-genre meetings at the Visby Interna-tional Centre for Composers are further examples,” says Mattias. “The Visby International Center for Composers (VICC) is one of just a few places in the world where professional composers – regardless of genre – can meet to exchange ideas, insights, and experiences. And STIM’s grant is of great importance if we are to keep this international meeting place up to date and of interest to our guests,” says Sten Melin, executive director at VICC.

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ACE WILDERAlice Gernandt, which is her real name, has merits that include writing songs that have made the top ten in Germany. Her major breakthrough back home came in 2014 in Melodifestivalen, the competition to determine Sweden’s entry in the Eurovision Song Contest, with the song Busy Doin’ Nothin’.

Two favorite albums:LORENTZ – KÄRLEKSLÅTARJESSIE WARE – TOUGH LOVE

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New pricing models for a digital worldIt started back in 2013 and really made its mark last year. For the first time, conventional TV viewing lost out in favor of various on demand services. As a consequence, STIM invests a great deal of energy in following market development and adapting its pricing models.

New TV viewing patterns have disjointed the old value chain as everyone attempts to get as close as possible to consumers. The traditional TV companies now offer different on demand services and compete with everyone from Netflix to online newspapers. “Daily viewing of scheduled TV fell by six minutes a day in 2014. For the commercial channels, this means a drop in advertising revenue. As such, we have to continually adapt our pricing models to ensure their applicability to new services. And we conduct this work in consultation with customers to ensure the best possible outcome,” says Nicklas Sigurdsson, Head of Sales and Marketing. The increase seen during the year was mostly in streamed video on demand, with providers such as HBO, Netflix, CMore, Viaplay, and TV4 Play Premium growing. “Parallel to this, we can see how the TV companies are trying to reduce their rights costs by using companies that sell music rights bought outright for a fixed price. As a result, we have to show the value of music and be transparent and easily understood, in relation to both those who pay and those who are paid,” says Nicklas. Streamed music also continues to grow while downloads are falling and everything would seem to indicate that streaming will soon dominate throughout Europe. All in all, online revenue increased by 17.9 percent, including European licensing.

THE DIGITAL MARKET

0

50

100

150

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250

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ON

LIN

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EW M

EDIA

REV

ENU

E, S

EK M

* Percentages reflect increase over previous year.

137.

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70.9

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43.4

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17.9

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Background to the fore

“Background music” is a phrase that is sometimes used to describe music that’s just there. But the phrase is starting to gain new mean-ing. The trend is for the music selection in, for example, stores and restaurants to be made more consciously, as research shows the importance of music to sales.

The music played in stores, gyms, coffee shops, and other public places is used with increasing awareness. A recent survey conducted by HUI Research shows, for example, that a store can increase its revenue by as much as 36 percent simply by choosing the right music. “We’re also seeing an increase in the number of companies providing background music. For example, during the year Spotify launched its Soundtrack Your Brand service, which offers music to stores, coffee shops, restaurants, and other establishments,” says Nicklas Sigurdsson, Head of Sales and Marketing. Another company that successfully delivers music solutions to gyms and sports centers is Swedebeat, which was awarded the 2014 STIM Guitar for its awareness of the value of music and for ensuring that music creators are compensated for their work. STIM’s income for background music increased somewhat in 2014 in all sub-categories, and market coverage has improved. “We introduced a new customer system in 2013, and last year we linked it to the PAR address register. This helps us keep track of the market. Say, for example, a clothing chain opens a new store, we’re automatically informed. We can then contact them about a new STIM license.” Digitization affects the use of background music, just as it does all other areas. So during the year STIM reviewed several old agreements, renewed them, and adapted them to the new circumstances. “This results in our authors receiving better compensation when their music is played,” says Nicklas. STIM is also taking a stronger stance against those who do not want to pay for their music, and in a few cases this has led to lawsuits. “A legal process is the last resort when we’ve spent a great deal of time trying to reach agreement. A lawsuit has two purposes: on the one hand we want to protect our mem-bers’ income and on the other we want our counterparts to be aware of the rules that actually apply.”

STIM AND BACKGROUND MUSIC

6%IN INCREASED REVENUE

IN RESTAURANTS.

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M

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2010 2011 2012 2013 2014

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2010 2011 2012 2013 2014

ANALOGOUS DATASTIM has about 30,000 licenses for background music. The majori-ty of these licenses fall into a category that STIM calls “Background music, not reported”. Here we find, for example, restaurants, hair-dressers, fitness centers, and hotels that pay a license fee to STIM, but where detailed music reporting from each individual licensee is judged to be impractical. As such, the revenue that STIM receives is distributed to authors in accordance with detailed analogous data (see the distribu-tion table on page 10). The data is based on what customers in statistically significant surveys actually specify as their primary music sources, that is, music use in Swedish Radio, commercial radio, TV, and record sales or downloads in Sweden. This method is neither unusual nor unique and is used by copyright organizations throughout the world.

EXAMPLE:The license fee for a store with a sales area of up to 100 square meters (1,076 sq. ft.) and open at least 312 days a year. Establish-ments with a sales area of between 2,001 and 2,500 square meters (21,539–26,910 sq. ft.) and open at least 312 days a year pay a fee of SEK 17,939 per year, i.e., a maximum of SEK 57.49 per day of business. The price for each day of business varies depending on how many days – between 312 and 365 – the establishment is open each year.

EXAMPLE:The annual license fee for background music in a restaurant/eatery with 1–20 covers and open at least 312 days a year is SEK 2,425, that is, SEK 7.77 per day of business. For a restaurant with 101–150 covers and open at least 312 days a year, the license fee is SEK 9,763 per year, i.e., SEK 31.29 per day of business. The price for each day of business varies depending on how many days – between 312 and 365 – the establishment is open each year.

EXAMPLE:The license fee for a supervised exercise class with up to 25 participants is SEK 13.22 per session/occasion. For an exercise class with more than 75 participants, the license fee is SEK 58.99 per session/occasion.

23%

77%

BACKGROUND

99%

1%

TV

96%

4%

ONLINE

98%

2%

RADIO

75%

25%

LIVE

Analogous data Report

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Equality among personnel and unified IT supportA new CEO and a merger with subsidiary CEE. Those were the two dominant events in terms of personnel in 2014.

“The recruitment of a new CEO began in the spring, and in August Karsten Dyhrberg Nielsen began work as CEO at STIM. His previous position was CEO of the Nordic copy-right organization NCB,” says STIM’s HR Manager Venke Osnes. The other major event during the year was the merger with STIM’s former subsidiary CEE Services AB, which provides administrative support and development for STIM’s documentation, music reporting, collection, and IT. “By combining the best parts of both operations, we’re better equipped for the future. Our IT work will be more focused when everything is housed in the same company, and we’ll also reduce administration needs.” When the merger took place in May, STIM’s operative Unit, then is headed by Sara Kilander, was expanded. Operations already encompassed service, distribution, sales, and marketing. Now it also includes music reporting and administration, as well as collection and documentation. “The merger means that STIM has twice as many employees as before. We’ve even strengthened the distribution department with another two people, and at the end of the year there were 126 of us working from Stimhuset on Hornsgatan in Stockholm.” 52 percent of employees are women and the percentage of women in managerial positions is as high as 67 percent. In terms of salaries, women receive a little more than men. “There’s a lot of talk about the lack of women in executive positions in the music industry. It’s nice that STIM can help even out those statistics a little,” says Venke.

STIM AND ITS EMPLOYEES

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JOHAN BECKERJohan got his big break when he won the Swedish real-ity TV show Fame Factory in 2004. As a composer, he’s written songs for both himself and other artists, and in 2011 he had his first number one single in Japan with the band Exile and the song Rising Sun.

One favorite album:ALICE IN CHAINSDIRTAn album I’ve listened to con-stantly since its release.

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STIM’s Board of Directors and CEOBack row, from the left: Martin Jonsson Tibblin (proposed from 2015), Leif Pagrotsky, Monica Ekmark, Kristina Rennerstedt, Mattias Svensson Sandell, Annika Falkenäng.Second row, from the left: Alfons Karabuda, Elise Einarsdotter, Nutta Hultman, Martin Q Larsson, Eric Hasselqvist, Lars Karlsson.Front row, from the left: Eva Botmar, Kjell-Åke Hamrén, Karsten Dyhrberg Nielsen, Douglas Carr.

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BOARD OF DIRECTORSFST (Society of Swedish Composers), SKAP (Swedish Society of Songwriters, Composers, and Authors), and Musikförläggarna (Swedish Music Publishers Association) each appoint two mem-bers and one deputy. FST, SKAP, and Musikförläggarna jointly appoint the chair of the board and a further two members. The STIM local of Unionen appoints one member and two deputies.

Regular members Kjell-Åke Hamrén .............................................................ChairMartin Q Larsson ................................................................FSTErik Peters ..........................................................................FSTAlfons Karabuda .............................................................. SKAPJohan Ekelund ...................................... SKAP (until 8/18/2014)Douglas Carr ........................................SKAP (as of 8/19/2014)Monica Ekmark............................................. MusikförläggarnaEric Hasselqvist ............................................. MusikförläggarnaKristina Rennerstedt .......................................External memberLeif Pagrotsky ................................................External memberEva Botmar ................................................................Unionen Deputy membersMattias Svensson Sandell ....................................................FSTIda Lundén .........................................................................FSTDan Bornemark ............................................................... SKAP Elise Einarsdotter ............................................................. SKAPLars Karlsson ................................................ MusikförläggarnaNutta Hultman ............................................. MusikförläggarnaAnnika Falkenäng .......................................................UnionenAnders Cangemark .....................................................Unionen

Notes: During the year, the following individuals acted as chief executive officer of STIM: Helena Woodcock (during the period February–March 2014) and Alfons Karabuda (during the period April–July 2014). At the same time, Helena Woodcock sat on the boards of the companies CEE, ICE, and Kobalt STIM Aggre-gated Rights AB while Alfons Karabuda sat on the boards of the companies CEE and Kobalt STIM Aggregated Rights AB. During his time as Acting CEO, Alfons Karabuda did not sit on STIM’s board of directors. STIM is owned by its members. We sometimes use the phrase “the organizations that own us” since the members have dele-gated the task of electing STIM’s board of directors to FST, SKAP, and Musikförläggarna.

SVENSK MUSIK SWEDMIC AB Svensk Musik Swedmic AB is a wholly-owned subsidiary of STIM since 2008. Its task is to document and provide information about copyright-protected Swedish music. This is achieved by, for example, cataloging and archiving art music and older pop-ular music and producing music scores for, among other things, orchestral works and works for larger jazz ensembles. Svensk Musik also administers travel grants for STIM-affiliated authors.

Board of Directors Dror Feiler ................................................................ FST, ChairPeter Magro ................................................. MusikförläggarnaAlfons Karabuda ............................... SKAP (through May 2014)Elise Einarsdotter ...................................SKAP (as of June 2014)

The STIM sphere

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STIMKARSTEN DYHRBERG NIELSEN

Group

ICE SERVICES AB50 PERCENT

INTERNATIONAL COPYRIGHT ENTERPRISE SERVICES AB

JOINTLY-OWNED WITH BRITISH PRS FOR MUSIC

CEO CARSTEN DRACHMANN UNTIL MARCH 2015

ICEINTERNATIONAL

COPYRIGHT ENTERPRISE

GERMANY GMBH

KOBALT STIM AGGREGATED

RIGHTS AB

STIM FASTIGHETS HOLDING AB

SVENSK MUSIK SWEDMIC ABHEAD OF OPERATIONS

GUSTAF BERGEL

CEE SERVICES ABDORMANT

STIMHUSET KB

NCBNORDISK COPYRIGHT BUREAUJOINTLY-OWNED WITH STIM’S

NORDIC COUNTERPARTSCEO HÅKAN HILDINGSSON

The agreement with Kobalt

STIM Aggregated Rights AB, a

collaboration between STIM

and Kobalt Music Group,

expires in June 2015.

Existing licenses will remain

in effect during a transition

period.

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2014 2013 2012

CEE Services AB

Revenue (within the Group, %) 24,929 (100%) 82,234 (100%) 83,031 (100%)

Operating profit/loss 1,302 1,529 4,514

Average number of employees 20 52 48

Kobalt Stim Aggregated Rights AB**

Revenue (within the Group, %) 120,733 (54%) 31,453 (46%) -

Operating profit/loss 4,185 -2,121 -

Average number of employees - - -

Stim Fastighets Holding AB


Operating profit/loss -145 1,488 -234


Svensk Musik Swedmic AB


Operating profit/loss 27 2 17


ICE Services AB*

Revenue (within the Group, %) 119,677 (21.6%) 116,234 (1.64%) 97,512 (9.81%)

Operating profit/loss -6,835 1,952 835


Stimhuset KB


Operating profit/loss 12,999 12,793 3,590


Group performance – 3-year summary

* The figures for ICE Services AB do not include the subsidiary ICE International Copyright Enterprise Germany GmbH. The figures for ICE Services AB have not been revised. ** The agreement with Kobalt STIM Aggregated Rights AB, a collaboration between STIM and Kobalt Music Group, expires in June 2015. Existing licenses will remain in effect during a transition period.

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CEE SERVICES AB Dormant company

Board of Directors*Helena Woodcock ............................................................ChairKristina Paulsson ..........................................................DeputyNicklas Lindström........................................................Unionen

ICE, INTERNATIONAL COPYRIGHT ENTERPRISE SERVICES ABICE, founded in 2007 with STIM’s UK counterpart PRS for Music as an independent commercial company, is owned on a 50/50 basis by STIM and PRS for Music. ICE’s primary role is to administer the data volumes required to license and distribute the financial remuneration to authors and publishers, Swedish and international, when their works are played, recorded, streamed, or legally downloaded.

Board of Directors*

Wanda Goldwag ...........PRS for Music, Chair (as of 11/28/2014)

Kjell-Åke Hamrén .................STIM, (Chair until November 2014)

Karsten Dyhrberg Nielsen ................. STIM, (elected 9/18/2014)

Kristina Paulsson ............................................................. STIM

Robert Ashcroft ................................................... PRS for Music

Craig Nunn ......................................................... PRS for Music

Patrik Lindgren ...................................Employee representative

NCB, NORDIC COPYRIGHT BUREAUNCB, Nordisk Copyright Bureau, is tasked with upholding the rights of authors and music publishers in the recording, copying, and distributing of protected music and lyrics on CD, vinyl, DVD, and similar media. NCB is owned by STIM and its counterparts in Denmark (KODA), Finland (TEOSTO), Norway (TONO), and Iceland (STEF). NCB also administers the mechan-ical rights of the Baltic collecting societies, LATGA-A (Lithuania), EAÜ (Estonia), and AKKA-LAA (Latvia). NCB has agreements with copyright societies abroad that administer mechanical rights in a corresponding manner in their countries.

Board of Directors*Anders Lassen.................................................CEO, Koda, ChairSusi Hyldgaard .................................................... Author, KodaTine Birger Christensen ........................... Music publisher, KodaGudrun Björk Bjanadottir .......................................... CEO, STEFKarsten Dyhrberg Nielsen ........... CEO, STIM (as of August 2014)Alfons Karabuda .................................................. Author, STIMLars Karlsson .......................................... Music publisher, STIMKatri Sipilä ............................................................. CEO, TeostoKim Kuusi .......................................................... Author, TeostoTommi Tuomainen ................................ Music publisher, TeostoCato Ström ...............................................................CEO, TonoBendik Hofseth .....................................................Author, TonoSteinar Fjeld ........................................... Music publisher, Tono

Observers from the Baltic countriesInese Paklone ................................................... CEO, AKKA/LAAKalev Rattus ..............................................................CEO, EAÜJonas Liniauskas .................................................. CEO, LATGA-AJakob Friman Magnusson ......................................... CEO, STEFAnne Louise Holsoe ............................Employee representative

KOBALT STIM AGGREGATED RIGHTS AB Kobalt STIM Aggregated Rights AB was a collaboration between STIM and the music publisher Kobalt Music Group that has enabled multi-territorial digital music services to acquire music licenses for the European market. The agreement with Kobalt STIM Aggregated Rights AB, a collaboration between STIM and Kobalt Music Group, expires in June 2015.

Board of Directors*Karsten Dyhrberg Nielsen ............. STIM (as of September 2014)Helena Woodcock ............................................................ STIMTomas Ericsson ...........................................Kobalt Music GroupKristina Paulsson .................................................STIM, Deputy

* Kenth Muldin was a representative during the period January–February 2014.

AVICIIIn February, Wake Me Up by Tim “Avicii” Bergling became the most played song on Spotify ever, amassing more than 200 million plays. And at the 2014 STIM Music Expo, Tim was awarded a Platinum Guitar for his exceptional achievements.

One favorite album:PINK FLOYDDARK SIDE OF THE MOON

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“Naturally, songwriters should be paid when their works are performed. As soon as we started the company, we ensured that all rights were in place,” says Johan Blomberg, CEO of Swedebeat AB (left), who together with colleague Linus Sjöberg received a 2014 STIM Guitar.

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STIM’s committeesASSESSMENT COMMITTEE FOR MUSIC AND COPYRIGHTProvides opinions on similarities between musical works in copyright disputes.

Helena Woodcock ..................................................STIM, ChairJonas Nordin ...................................................STIM, SecretaryPeo Nylén.....................................................MusikförläggarnaDouglas Carr .................................................................. SKAPMattias Svensson Sandell ...................................................FST

SCHOLARSHIP COMMITTEEAwards STIM’s scholarships.

Ragnar Grippe ................................................................ ChairStefan Gullberg .............................................MusikförläggarnaSarah Riedel ................................................................... SKAPJesper Nordin ....................................................................FSTEva Lindal ...................................................................ExternalJosephine Forsman .....................................................External

GRADING COMMITTEEEstablishes praxis for grading and deals with grading complaints.

Regular membersMats Edén ...................................................................... SKAPTorgny Söderberg ............................................................ SKAPJonas Valfridsson ...............................................................FSTYlva Q Arkvik ......................................................................FSTKristina Fryklöf ..............................................Musikförläggarna

Deputy membersJan Levander .................................................................. SKAPAnna Einarsson ............................................................... SKAPKristina Forsman ................................................................FSTJohan Ramström ...............................................................FSTIngemar Hahne ............................................Musikförläggarna

DISTRIBUTION COMMITTEEPreparatory body for the Board in distribution issues.

Karsten Dyhrberg Nielsen .................. Chair (as of August 2014)Kenth Muldin ..................................Chair (until February 2014)Martin Q Larsson ...............................................................FSTChrichan Larson .................................................................FSTAlfons Karabuda ............................................................. SKAPÖrjan Strandberg ............................................................ SKAPKettil Skarby .................................................MusikförläggarnaMonica Ekmark.............................................MusikförläggarnaKjell-Åke Hamrén .............................................................STIM

COMMITTEE FOR NATIONAL FUNDSPreparatory body for the promotion of Swedish music.

Kjell-Åke Hamrén ............................................................ ChairAlfons Karabuda ............................................................. SKAPMartin Q Larsson ...............................................................FSTMonica Ekmark.............................................MusikförläggarnaKarsten Dyhrberg Nielsen ...................STIM (as of August 2014)Kenth Muldin .................................. STIM (until February 2014)

FEES COMMITTEE Preparatory body for the annual general meeting to propose fees to regular and deputy members of STIM’s Board of Direc-tors, committees, and subsidiary boards.

Sten Melin .........................................................................FSTClaes Ånstrand ............................................................... SKAPMargareta Neld ............................................Musikförläggarna

STIM’S PROMOTION COMMITTEE (SPN) Initiates and supports projects that aim to improve the avail-ability and recognition of new Swedish music – both nationally and internationally.

Fredrik Wetterqvist ............................................ Chair, externalAlfons Karabuda ............................................................. SKAPMårten Karlsson ............................................................. SKAPDror Feiler .........................................................................FSTAnne Pajunen....................................................................FSTGunnar Helgesson ........................................MusikförläggarnaNutta Hultman .............................................Musikförläggarna

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CEOKARSTEN DYHRBERG NIELSEN

SECRETARIATHUMAN RESOURCESVENKE OSNES

STIM’s organization*

LEGALHELENA WOODCOCK

COMMUNICA-TION

KARIN JIHDE

FINANCEKINA PAULSSON

STRATEGY & IT

CHARLOTTE VON SYDOW

REPORTING &

COLLECTIONNILS DANIELSSON

RIGHTS-HOLDERSSARA KILANDER

SALES AND MARKETING

NICKLAS SIGURDSSON

*Applies as of May 1, 2015

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DESCRIPTION OF OPERATIONSSTIM is a special-interest copyright organization for music authors and publishers. STIM administers and licenses rights to music and lyrics on their behalf. Through its international net-work, STIM also represents rights to the worldwide repertoire of music. Moreover, STIM promotes the creation and distribution of new Swedish music.

At year-end, STIM had more than 77,600 affiliated composers, lyricists, arrangers, and music publishers. STIM upholds the economic rights of authors and music publishers under copy-right legislation Based on inter-governmental agreements and reciprocal agreements with STIM’s counterpart organizations abroad, rights to both domestic and international music in Sweden are protected.

When a rightsholder joins STIM, they transfer their legal rights to recompense in connection with public performance, record-ing, and mechanical reproduction to STIM. STIM ensures that anyone who plays music in public or who records, downloads, or streams music has a valid license and pays a fee.

STIM then pays the monies received to the owner or owners of the rights to the music. As such, STIM licenses all the music of the world to users of music and distributes the revenue collected to the individual rightsholders, both Swedish and in-ternational. This means that anyone who wishes to use music in, for example, a radio broadcast, a store, or a night club can easily obtain access to millions of musical works with a license from STIM. It also means that the owners of the copyright to the music are paid for the use of their music.

Together with British copyright organization PRS for Music, STIM owns the company ICE (International Copyright Enterprise Services AB) for managing the works documentation required to license works and collect financial compensation for right-sholders. ICE, with a recently founded subsidiary in Berlin, is owned by the parties on a 50/50 basis.

ORGANIZATION Kenth Muldin left STIM in February 2014, after more than ten years as Chief Executive Officer, and in August 2014 Karsten Dyhrberg Nielsen took over the role. During the interim period, Helena Woodcock (February to April) and Alfons Karabuda (April to August) were acting CEOs. On May 1, 2014, the operations of the subsidiary CEE Services AB, including its personnel, were transferred to the parent society STIM. In August 2014, Johan Ekelund stepped down from STIM’s Board of Directors and was replaced by former deputy Douglas Carr.

NON-FINANCIAL PERFORMANCE INDICATORSHR policy and equal opportunities planObjective and follow-up dialogs provide a basis for skills devel-opment. Openness and transparency are important corner-stones of the organization. All employees can freely access our extensive personnel policy.

Work environment policyWork environment management at STIM aims to create conditions that favor a positive atmosphere and environment at work. A clear policy is used to support STIM’s ongoing man-agement of the work environment. Responsibility for the work environment falls to each immediate manager.

Equal opportunities planAt STIM, work conditions and development opportunities are to be independent of gender, ethnicity, sexual orientation, functional disability, age, religion, and faith. At STIM, we expect everyone to act to ensure a workplace characterized by equality.

Administration Report The Board of Directors and the Chief Executive Officer of Svenska Tonsättares In-ternationella Musikbyrå (STIM) u.p.a., corporate identity number 702002-3524, hereby present the annual report and consolidated financial statements for the 2014 financial year.

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Occupational health servicesIn cooperation with health and fitness company Korpen, STIM is a health-certified company, offering health and fitness opportunities to its employees. Measures include workplace massages, exercise on company time, and gym memberships for all employees. The company’s health and fitness committee actively works to inspire and motivate employees to improve their health with regular health and fitness activities.

SIGNIFICANT EVENTS DURING THE FINANCIAL YEARCEO Kenth Muldin left STIM in February 2014 and Karsten Dyhr-berg Nielsen took the helm in August.

In February 2014, the European Parliament adopted the new EU directive on collective rights management. This directive states that music rights organizations shall openly disclose details relating to their finances and management, and that it shall be easier for consumers to use digital services in more than one country. The directive is expected to be incorporated in Swedish legislation as of 2016.

Two extraordinary general meetings were held in the winter of 2013/2014. Both meetings were attended by a simple majority. However, at the second meeting held on February 18, the Board’s proposal to change the distribution rules was rejected as it just fell short of a qualified majority. As such, the distribu-tion rules are unchanged from their current form.

In June 2014, ICE (International Copyright Enterprise Services AB) signed an agreement with Belgium-based SABAM. It also opened offices for a wholly-owned subsidiary in Berlin in order to better facilitate Germany’s GEMA becoming an ICE customer. The Nordic constellation Polaris Nordic – which is comprised of the copyright organizations Koda (Denmark), TONO (Norway), and Teosto (Finland) – signed a Letter of Intent with ICE.

Together with British PRS for Music and German GEMA, STIM is working to find a common licensing solution. This work is ex-pected to reach completion during 2015, although the matter is currently under the scrutiny of the EU Commission as regards its antitrust policy.

In September 2014, the company Stim Fastighets AB, including the property Stettin 7, was sold, providing the Group with a profit of SEK 262.7 million.

During the year, STIM began work on its strategy and this is expected to be completed in the spring of 2015. The strategy work is headed by the CEO and will result in a strategic govern-

ing document for STIM’s operations for the period 2015–2018.

SIGNIFICANT EVENTS AFTER THE END OF THE FINANCIAL YEAR ICE began delivering services to Buma/Stemra at the beginning of the year.

The first YouTube royalties, for compensation for the use of music in Europe during the fourth quarter of 2013, were distrib-uted in March 2015.

In March 2015, a decision was made to reorganize ICE. In conjunction with this, Carsten Drachmann will quit as chief executive officer and Craig Nunn, finance director at PRS for Music, will step in as acting chief executive officer.

In order to protect affiliated members’ rights, STIM has filed lawsuits against a number of companies that do not pay STIM license fees, including rental car company Fleetmanager and several restaurant companies. In April 2015, SF Anytime, owned by Bonnier, was sued as STIM claims that the company breaches copyright law by not compensating authors for music included in its film offering.

The agreement with Kobalt STIM Aggregated Rights AB, a collaboration between STIM and Kobalt Music Group, expires in June 2015. The decision to end the collaboration means that KStar will not sign any new licenses, but the existing licenses will remain valid during a transition period.

SIGNIFICANT RISKS AND UNCERTAINTIESStim Fastighets AB was sold in September 2014. However, the buyer is not in agreement with STIM as regards the exact size of the purchase consideration and has informed STIM that part of the purchase consideration may be appealed. This has been taken into consideration in the annual accounts.

New Swedish legislation on collective rights management, based on the EU’s collective rights management directive, is being drawn up. The exact formulation of the new legislation remains uncertain.

The joint work of STIM, PRS for Music, and GEMA to create a hub for common licensing is currently under the scrutiny of the EU Commission.

New markets and payment models, international and national, have continually changed in recent years. These changes are expected to continue in the future, which leads to uncertainty regarding future investments.

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CONSOLIDATED PROFIT (SEK THOUSAND) 2014 2013 2012 2011 2010Operating income 2,015,408 1,619,218 1,479,909 1,433,025 1,390,641

Operating costs -219,588 -181,568 -175,602 -159,968 -168,237

Result from participations in joint venture companies* -4,495 298 -439 -1,404 -13,126

Impairment of non-current receivables from other companies -1,461 – – – –

Distribution -1,542,763 -1,441,004 -1,312,033 -1,288,499 -1,227,287

Interest 2,678 1,679 5,783 13,844 3,695

Appropriations and taxes -71 -246 -138 -140 -86

Profit/loss for the year 249,709 -1,621 -2,520 -3,142 -14,400

Group

*In 2013, the Group changed the accounting policy. Comparative figures have been recalculated.

PARENT SOCIETY’S PROFIT, SEK THOUSAND 2014 2013 2012 2011 2010Operating income 1,677,956 1,584,064 1,455,816 1,419,234 1,373,137

Operating costs -196,853 -168,717 -159,926 -151,242 -147,007

Impairment of non-current receivables from other companies -1,461 – – – –

Operating profit/loss 1,479,642 1,415,347 1,295,553 1,267,992 1,226,130

Interest 8,338 11,461 16,551 16,822 5,370

Appropriations and taxes* 17,026 -273 -408 3,685 -4,213

Distributable income 1,505,006 1,426,535 1,312,033 1,288,499 1,227,287

Parent Society

*In 2013, the Group changed the accounting policy and reclassified group contributions from operating profit to appropriations. Comparative figures have been recalculated.

GroupThe Group’s revenue during the financial year was SEK 2,015.4 (1,619.2) million. Operating costs totaled SEK 219.6 (181.6) million. The result from participations in associated companies amounted to SEK -4.5 (0.3) million.

Distributable income in the Group totaled SEK 1,792.5 (1,439.3) million.

Parent SocietyThe Parent Society STIM’s total sales for the financial year totaled SEK 1,678.0 (1,584.1) million, corresponding to an increase of 5.9 (8.8) percent compared to the previous year.

Revenue for the performance of music both in Sweden and abroad increased by SEK 112.9 (102.5) million, or 8.2 (8.1) percent, while revenue from mechanical reproduction decreased by SEK -24.9 (21.2) million, or -13.3 (12.8) percent.

The Parent Society STIM’s net distributable income totaled SEK 1,505 (1,426.5) million, corresponding to an increase in royalty payments to rightsholders equal to SEK 78.5 (114.5) million, or 5.5 (8.7) percent.

SALES AND PERFORMANCE

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FINANCIAL POSITION Group The Group’s accumulated profit at year-end was SEK 225.5 (-24.2) million.

Parent Society STIM’s equity at year-end totaled SEK 1.2 (1.2) million, or 0.1 (0.1) percent of the balance sheet total. Liabilities to rightsholders at year-end totaled SEK 881.8 (809.5) million.

LiquidityCash and cash equivalents totaled SEK 380.7 (9.9) million for the Parent Society and SEK 408.1 (28.3) million for the Group. Surpluses are invested in short-term fixed interest funds in accor-dance with the current investment policy.

GROUP CONTRIBUTIONSDuring the financial year, the Parent Society received group contri-butions from subsidiaries totaling SEK 17 (-0.06) million.

PROPOSED APPROPRIATION OF PROFITThe following amount is available for appropriation by the Annual General Meeting:Retained earnings, SEK 4,841Profit for the year, SEK 0

Total 4,841

The Board proposes that the available earnings be carried forward, SEK 4,841

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(SEK THOUSAND) NOTE 2014 2013 2014 2013Operating income

Performance revenue 1,539,992 1,390,287 1,486,234 1,373,356

Mechanical reproduction revenue 161,874 186,698 161,874 186,698

Other revenue 313,542 42,233 29,848 24,010

Total operating income 1, 3 2,015,408 1,619,218 1,677,956 1,584,064

Operating costs

External costs 2, 3, 6 -92,837 -73,949 -101,746 -106,274

Personnel costs 2, 4, 5 -104,831 -87,843 -83,079 -52,440

Depreciation/amortization 2, 9–11 -21,920 -19,776 -12,028 -10,003

Total operating costs -219,588 -181,568 -196,853 -168,717

Profit/loss from participations in joint venture companies 13 -4,495 298 – –

Impairment of non-current receivables from other companies -1,461 – -1,461 –

Distribution 7 -1,542,763 -1,441,004 -1,505,006 -1,426,535

Operating profit/loss 247,102 -3,055 -25,364 -11,188

Interest income 3,137 3,311 8,791 13,077

Interest expense -459 -1,631 -453 -1,616

Profit/loss before tax 249,780 -1,376 17,026 273

Appropriations – – 17,011 -56

Profit/loss before tax 249,780 -1,376 -15 217

Tax on profit for the year 21 -71 -246 15 -217

Profit/loss for the year 249,709 -1,621 0 0

Income statement

GROUP PARENT SOCIETY

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(SEK THOUSAND)ASSETS NOTE 12/31/2014 12/31/2013 12/31/2014 12/31/2013Fixed assets

Intangible assets

Current investment in new IT systems 8 1,730 5,846 1,730 5,758

System development costs brought forward 9 34,427 36,066 31,420 34,345

Total intangible assets 36,157 41,912 33,150 40,103

Tangible assets

Buildings and land 10, 22 382,888 428,242 – –

Construction, extensions, and redevelopment in progress 691 642 – –

Equipment 11 6,804 9,860 6,193 7,021

Total tangible assets 390,383 438,743 6,193 7,021

Financial assets

Participations in group companies 12 – – 300 300

Participations in joint venture/associated companies 13 34,826 39,326 54,051 1

Receivables from group companies – – 100,387 480,754

Receivables from joint venture/associated companies 26,179 34,850 26,179 34,850

Other financial assets 2 3,706 2,889 3,706 2,889

Other non-current receivables 494 988 494 988

Total financial assets 65,205 78,052 185,117 519,781

Deferred tax claims 21 1,013 790 1,013 790

Total fixed assets 492,758 559,497 225,473 567,695

Current assets

Current receivables

Accounts receivable 172,600 174,405 151,615 171,243

Receivables from group companies – – 81,037 33,078

Receivables from joint venture/associated companies – 1,071 – 669

Other receivables 16,728 15,999 14,075 15,641

Tax claims 1,282 689 782 113

Prepaid expenses and accrued revenue 14 277,251 261,733 224,677 235,180

Total current receivables 467,861 453,897 472,185 455,924

Current investments 313,070 7,912 313,070 7,912

Cash and bank balances 95,101 20,357 67,660 1,959

Total current assets 876,032 482,166 852,915 465,794

Total assets 1,368,790 1,041,663 1,078,389 1,033,489

Balance sheet


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(SEK THOUSAND) NOTE 12/31/2014 12/31/2013 12/31/2014 12/31/2013Equity and liabilities

Equity

Restricted equity

Contributed capital 5 5 5 5

Other restricted equity 1,226 1,226 1,226 1,226

Total restricted equity 1,232 1,231 1,231 1,231

Accumulated deficit/unrestricted equity

Accumulated deficit/unrestricted equity -24,171 -22,544 5 5

Profit/loss for the year 249,709 -1,621 – –

Total accumulated deficit/unrestricted equity 225,538 -24,165 5 5

Total equity 15 226,770 -22,934 1,236 1,236

Provisions

Provisions for pensions 2, 21 4,605 3,590 4,605 3,590

Total provisions 4,605 3,590 4,605 3,590

Non-current liabilities

Non-current liabilities 16 571 – – –

Total non-current liabilities 571 – – –

Current liabilities

Bank overdraft facility 17 – 22,676 – 22,676

Liabilities to credit institutions – – – –

Accounts payable 8,892 8,975 7,481 6,099

Distribution liabilities 18 907,871 823,994 881,753 809,473

Liabilities to group companies – – 2,867 7,153

Liabilities to joint venture/associated companies – – – –

Tax liabilities 444 – 198 –

Other liabilities 19,372 12,011 6,237 4,552

Accrued expenses and prepaid revenue 19 200,266 193,351 174,011 178,709

Total current liabilities 1,136,844 1,061,008 1,072,547 1,028,663

Total equity and liabilities 1,368,790 1,041,663 1,078,389 1,033,489

Pledged assets 20 – 176,045 – –

Contingent liabilities 20 See note 20 See note 20 See note 20 See note 20


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(SEK THOUSAND) NOTE 2014 2013 2014 2013Operating activities

Payments from customers 1,981,317 1,469,639 1,660,978 1,427,860

Payments to rightsholders 18 -1,434,573 -1,294,925 -1,402,033 -1,294,925

Payments to suppliers and employees -412,451 -212,194 -203,288 -202,904

Cash flow from operating activities before inter-est paid and income taxes paid 134,293 -37,480 55,657 -69,969

Interest received 3,137 3,311 8,791 13,077

Interest paid -459 -1,631 -453 -1,616

Income taxes paid -319 -270 -233 -241

Cash flow from operating activities 136,652 -36,070 63,762 -58,749

Investing activities

Investments in intangible assets 8 -4,057 -10,507 -1,761 -8,607

Investments in tangible assets 10, 11 -10,020 -28,757 -3,202 -1,597

Disposal of tangible assets 10, 11 272,223 499 715 496

Investments in financial assets 3,417 -3,194 59,842 -3,193

Amortization of financial assets 4,363 – 274,179 10,680

Current financial investments -305,158 58,793 305,158 58,791

Investments in subsidiaries 22 – – – -50

Cash flow from investing activities -39,232 16,834 24,615 56,520

Financing activities

Loans from credit institutions -22,676 -77,324 -22,676 -77,324

Cash flow from financing activities -22,676 -77,324 -22,676 -77,324

Cash flow for the year 74,744 -96,560 65,701 -79,553

Cash and cash equivalents at beginning of year 20,357 116,917 1,959 81,512

Cash and cash equivalents at year-end 95,101 20,357 67,660 1,959

Cash flow statement


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ACCOUNTING POLICIESThe accounting and valuation policies applied conform to the Swedish Annual Accounts Act and the general recommenda-tions of BFNAR 2012:1 as issued by the Swedish Financial Ac-counting Standards Council. These combined regulations were first applied in 2013, entailing a change of accounting policy. The applied policies are unchanged compared to the previous year unless otherwise stated below.

CONSOLIDATED ACCOUNTS The consolidated accounts include subsidiaries where the parent company, directly or indirectly, controls more than 50 percent of the votes or otherwise exercises a controlling influence. The consolidated financial statements are prepared in accordance with the acquisition method, whereby the equity of the subsid-iaries at acquisition – calculated as the difference between the fair values of assets and liabilities – is eliminated in its entirety As such, consolidated equity includes only that portion of the equity of the subsidiaries that has arisen after acquisition.

ASSOCIATED COMPANY ACCOUNTING Associated companies are those companies in which the Group has a significant but not controlling influence, which in general means holdings encompassing 20% to 50% of the votes. Hold-ings in associated companies are reported in accordance with the equity method. When applying the equity method, the investment is initially valued at acquisition value. The reported value is then increased or decreased by the holding company’s share of the associated company’s profit or loss. Any dividends that are received reduce the reported value.

JOINT VENTURE COMPANY ACCOUNTINGJoint venture companies are those companies in which the Group has a joint controlling influence over operations and a right to the net assets of those operations. Joint venture com-panies are reported in accordance with the equity method. With the equity method, participations in a company are reported at acquisition value at the acquisition date and are

then adjusted to reflect the Group’s share of the change in the joint venture company’s net assets. The consolidated income statement includes the Group’s share in the results of joint venture companies. The financial statements for the Parent So-ciety recognize shares in joint venture companies at acquisition value less any impairment losses.

REVENUE RECOGNITIONOperating income includes – after the deduction of value add-ed tax – rental revenue throughout the term of the lease and royalties in accordance with the economic implications of the current agreement. Business grants and library levies are re-quested annually from the Swedish Arts Council and Sweden’s Legal, Financial, and Public Procurement Agency respectively. Interest revenue is recognized using the effective return.

DISTRIBUTIONThe annual revenue from providing rights for public perfor-mances is burdened with the society’s expenses for this area of operations. The remainder comprises a liability to the society’s members and affiliated members who have transferred their rights. Following a decision at the annual general meeting, a maximum of three percent of the remuneration due to the society’s members and affiliates may be used for scholarship purposes. Furthermore, following a decision by the annual general meeting and in accordance with special rules, creativity in musical fields that are vulnerable to market forces is sup-ported with special initiatives in such fields. Regarding royalties from foreign organizations that cooperate with the society, such royalty payments are made without the above-mentioned deductions. The amounts to be paid for rights provided via the society are distributed in accordance with the rules established at the annual general meeting held on May 22, 2008 and at the extraordinary general meeting held on June 18, 2008. The Board of Directors determines how these rules are to be applied and continually reviews the system. Regarding changes to the distribution rules, the stipulations of the Articles of Incorporation on changes to said Articles apply.

Accounting and valuation policies

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INTANGIBLE AND TANGIBLE ASSETSIntangible assets, such as computer software, are recognized at acquisition value less deductions for accumulated depreciation according to plan. “Off-the-shelf” software is expensed directly. Costs related to software developed or substantially modified on STIM’s behalf is capitalized as an intangible asset if said software is deemed to lead to probable economic benefits that after a year exceed the costs incurred. Development costs brought forward for acquired software are depreciated on a straight-line basis over the estimated service life, although subject to a maximum of 10 years. Depreciation is applied as of the time at which the asset is ready to be placed in service. As such, no depreciation is applied to investments in progress. Tangible assets are reported at acquisition value less deduc-tions for accumulated depreciation according to plan. Expendi-ture to improve the performance of assets, above their original level, is added to the carrying value of the asset. Expenses for repairs and maintenance are recognized as costs. Tangible as-sets are depreciated on a straight-line basis over the estimated service life of the asset. A straight-line method is applied to all categories of tangible and intangible assets.

THE FOLLOWING DEPRECIATION PERIODS ARE APPLIED:Components in buildingsShell, roof, and windows ............................................ 50 yearsTenant adaptations ...................................................... 5 yearsFacade ...................................................................... 30 yearsOverhead walkways and elevators ............................. 25 yearsPassages, locks, and fiber ........................................... 15 yearsPlumbed facilities and plumbing .................................10 yearsBuilding facility ...........................................................10 yearsOther fixed assetsSystem development ..................3, 5, and 10 years respectivelyPlant and machinery.................................................... 5 yearsComputers .................................................................. 3 yearsIn the case of the property Krukomakaren 17, 56 percent of the building is held for investment purposes.No division into components was made in 2013 for the proper-ty Stettin 7 as the property was sold in 2014.

CURRENT ASSETSFinancial instrumentsFinancial instruments are classified into the following catego-ries: financial assets valued at fair value through the income statement, financial assets that can be sold, loans receivable, and accounts receivable, as well as loans payable and accounts payable. Classification depends on the purpose for which the instrument was acquired.Financial assets valued at fair value through the income statementThis class of financial instrument comprises financial assets held for trading. A financial asset is classed in this category if it is acquired with the primary purpose of selling it in the near future. Derivative instruments are always included in this cat-egory, except in cases where the derivative instrument is part of a hedge transaction. The society has classified endowment insurance linked to pension commitments as financial assets valued at fair value through the income statement.Financial instruments that can be soldThis class includes financial instruments that can be sold and that are not derivatives. Financial instruments in this category are valued at fair value.Loans receivable and accounts receivableLoans receivable and accounts receivable have established payments and are held with no intention of trading. They are included under current assets with the exception of items with a due date more than one year after the balance sheet date, which are classified as non-current assets. Valuation after the acquisition date is at the accumulated acquisition value with the application of the effective interest method, with deduc-tions for any decline in value. Impairment of accounts receiv-able and loans receivable is reported in the income statement under Other external costs.Loans payable and accounts payableLoans payable and accounts payable are reported after the acquisition date at the accumulated acquisition value with the application of the effective interest method.Purchases and sales of financial instruments are reported on the transaction date, that is, the date when a binding agree-ment is entered. All financial instruments that are not valued at fair value are initially valued at acquisition cost, adjusted for transaction costs.

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PROVISIONSA provision is reported in the balance sheet when the Group has a present legal or constructive obligation as a result of past events, settlement of the obligation is expected to result in an outflow of resources, and the amount to be settled can be esti-mated reliably. If the point in time at which settlement is made has a significant effect, the provision is calculated by discount-ing the expected future cash flow. Discounting is applied at a pre-tax interest rate that reflects current market assessments of the time value of money.

CONTINGENT LIABILITIES/GUARANTEE COMMITMENTSA contingent liability (guarantee commitment) is reported when there is a possible obligation arising from past events and its presence will be confirmed by one or more uncertain future events or when there is an obligation that has not been reported as a liability or provision due to it not being probable that an outflow of resources will be required.

EMPLOYEE BENEFITSThe Group’s plans for benefits once employment has ended encompass both defined benefit and defined contribution pen-sion plans. With a defined benefit pension plan, the pension is based on final salary and the number of years of member-ship in the plan. The Group carries the risk of the established benefits being paid. Certain defined benefit pension plans are secured with an insurance plan from Alecta, and this is a defined benefit pension plan encompassing several employ-ers. The company has not had access to such information as necessary to report this plan as a defined benefit pension plan. As such, Swedish ITP pension plans secured with insurance from Alecta are reported as a defined contribution plan. With defined contribution plans, the company pays set premiums to a separate legal entity. Once the premium is paid, the compa-ny has no further obligations.The company has pension commitments with values linked to separate endowment insurance policies held by the company. The value of the endowment insurance always covers the ob-ligation to pay pensions, but not the obligation to pay special employer’s contributions in conjunction with the pension being disbursed. The company’s obligation is limited to the amount for which the endowment insurance was acquired. Benefits to employees such as salary and pension are reported as costs in the period in which the employee conducted the services the benefits cover.

INCOME TAXESIncome tax reporting includes current tax and any deferred tax. Deferred tax is calculated in accordance with the balance sheet approach for all significant temporary differences. A temporary difference exists when the book value of an asset or a liability differs from the value for tax purposes. Such a difference can arise, for example, in the event of the appreciation or depre-ciation of an asset or when applied accounting policies differ between an individual group company’s accounts and the consolidated accounts.Deferred tax is calculated using the tax rate that has been decided or announced as of the balance sheet date and that is expected to apply when the deferred tax claim is realized or the deferred tax liability is settled. Deferred tax claims are reported to the extent it is probable that future taxable surpluses will exist against which the tem-porary differences can be offset.

CASH FLOW STATEMENTThe cash flow statement is prepared in accordance with the direct method. The reported cash flow consists only of the transactions that involve incoming or outgoing payments. Cash and cash equivalents comprise cash at bank and cash in hand.

FOREIGN CURRENCYThe Group receives a not-inconsiderable part of its revenue in foreign currencies. The amounts are accounted for in Swedish kronor, calculated at the exchange rates prevailing on the date of conversion. Purchases and sales are essentially conducted in the same currency and as such currency exposure is limited. Receivables and liabilities in currencies other than the function-al currency are translated using the closing rate on the balance sheet date (unrealized).

LEASINGFixed assets obtained via leasing are classified in accordance with the leasing agreement’s economic implications. Items leased via finance leasing are reported as fixed assets and future leasing fees are reported as interest-bearing liabilities. In the case of leased items classified as operating leases, the leasing cost is reported as an operating cost in the income statement. The Group has no significant finance leases. As such, all lease agreements are reported as operating leases, which means that the leasing fees, including additional initial charges but excluding costs for services such as insurance and maintenance, are reported as costs on a straight-line basis throughout the term of the lease.

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Note 1

Operating income

2014 2013 2014 2013Performance licenses 1,539,993 1,390,288 1,486,234 1,373,356

Performance of Swedish and foreign music in Sweden 957,418 868,432 903,659 851,501

Of which online and new media 322,541 244,871 268,782 227,940

Radio 28,298 27,767 28,298 27,767

Public service radio 51,825 50,659 51,825 50,659

Public service TV 62,560 67,506 62,560 67,506

Swedish TV 179,574 163,278 179,574 163,278

Foreign TV 17,090 15,379 17,090 15,379

Copyswede – TV 16,489 14,717 16,489 14,717

Movie theaters 13,869 14,352 13,869 14,352

Concerts and festivals 72,762 89,794 72,762 89,794

Stores and sales rooms 44,003 45,550 44,003 45,550

Restaurants 28,782 27,031 28,782 27,031

Night clubs, dance, bar DJs 27,442 24,637 27,442 24,637

Hotels 25,578 22,414 25,578 22,414

Sports and fitness 22,787 19,695 22,787 19,695

Municipal, county council, and care 18,114 15,262 18,114 15,262

Music at work 11,756 9,464 11,756 9,464

Theater, variety, and cabaret 4,579 5,280 4,579 5,280

Church concerts and musical church services 4,294 4,893 4,294 4,893

Transport 3,474 4,635 3,474 4,635

Other 1,601 1,248 1,601 1,248

Performance of Swedish music abroad and foreign music sub-published by STIM-affiliated publishers for entire Nordic region 537,710 487,688 537,710 487,688

Performance of Swedish and foreign music abroad distributed by STIM on behalf of others 44,865 34,168 44,865 34,168

Mechanical reproduction licensesRelates to the right to record, reproduce, and sell recordings. See also Note 18. Licensing was administered by NCB, Nordisk Copyright Bureau, of Copenhagen for the Nordic territory.

161,874 186,698 161,874 186,698

Other revenue 313,543 42,232 29,849 24,009

STIM/Svensk Musik, sheet music hire and recorded media sales 2,276 1,500 – –

STIM/Svensk Musik government grant/subsidy 1,952 2,039 – –

Private copying levy 11,120 11,756 11,120 11,756

Library levy 2,500 2,500 2,500 2,500

Administrative contribution from NCB 949 1,268 949 1,268

Rental revenue 13,572 13,093 – –

Profit from sale of buildings and land 262,744 – – –

Other 18,430 10,077 15,280 8,485

Total operating income 2,015,409 1,619,218 1,677,957 1,584,063


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Note 2

Operating costs

DEFINED CONTRIBUTION PLANSCertain pension plans are secured with an insurance plan from Alecta. This is a defined benefit pension plan encompassing several employers. The company has not had access to such information as necessary to report this plan as a defined benefit pension plan. As such, Swedish ITP pension plans secured with insurance from Alecta are reported as a defined contribution plan.

PENSION COMMITMENTS SECURED WITH ENDOWMENT INSURANCEThe outcome of certain other pension plans is linked to the develop-ment of individually signed endowment insurance policies.

The value of the endowment insurance always covers the obligation to pay pensions, but not the obligation to pay special employer’s contributions in conjunction with the pension being disbursed. A surplus arises when value growth is better than expected and this surplus falls to the policyholder. The value of the surplus fund as per December 31, 2014 was SEK 44 (23) thousand. The endowment insurance has been pledged as security. No part of the year’s provi-sion is covered by the Swedish Pension Obligations Vesting Act. The market value of the endowment insurance is established through the annual statement issued by the concerned bank or equivalent. The value of the endowment insurance as per December 31, 2014 was SEK 3,706 (2,889) thousand.

External costs 2014 2013 2014 2013Office and administration 78,996 59,326 86,951 89,526

Rental costs 853 854 8,686 6,439

IT operation 6,736 4,133 8,385 10,147

System development and maintenance 3,566 11,907 1,739 8,668

Development costs brought forward -5,142 -10,241 -4,015 -8,506

Property costs 7,829 7,970 – –

Total external costs 92,837 73,949 101,746 106,274

Personnel costs

Salaries and other remuneration 70,854 57,378 55,407 33,694

Social security expenses 21,183 18,207 16,933 10,747

Pension costs 10,586 8,682 8,700 5,968

Other personnel costs 2,208 3,576 2,039 2,031

Total personnel costs 104,831 87,843 83,079 52,440

Of which Board of Directors, CEO, and Deputy CEOs


Social security expenses 3,357 2,278 2,813 1,851

Pension costs 1,039 2,304 717 1,969

Of which Board of Directors


Social security expenses 576 405 532 365

Salaries and social security expenses totaling SEK 596 (564) thousand for an employee within national funds are presented in Note 7 (Distribution).

Depreciation

System development costs brought forward 9,811 6,383 8,713 6,293

Equipment 3,734 4,710 3,315 3,710

Buildings 8,375 8,682 – –

Total depreciation/amortization 21,920 19,776 12,028 10,003

Total operating costs 219,588 181,568 196,853 168,717


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Note 4

Average number of employees

Note 3

Intragroup transactions

Of the Parent Society’s total operating income for 2014, 4.3 (1.2) percent is attributable to sales to other group companies.

Of the Parent Society’s total operating costs for 2014, 21.8 (43.9) percent is attributable to purchases from other group companies.

Average number of employees Average number

of employeesOf which men Average number of employees Of which men

Parent Society 99 49% 60 53%

Subsidiaries 29 59% 62 47%

Group 128 51% 122 50%

Board members and senior executives Number on balance sheet

date

Of which men Number on balance sheet date Of which men

Parent Society

Board members, including employee representatives 10 70% 10 70%

Deputy board members, including employee representatives 7 43% 8 63%

Chief executives, deputy chief executives, and other senior executives 12 38% 12 42%

Group

Board members, including employee representatives 15 73% 16 81%

Deputy board members, including employee representatives 8 38% 9 56%

Chief executives, deputy chief executives, and other senior executives 16 47% 17 47%

2014 2013

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Note 5

Terms of employment for chief executive officer

Note 6

Auditors’ fees

2014 2013 2014 2013Auditing

KPMG AB 345 388 250 250

Auditors appointed by STIM 35 30 35 30

Other non-auditing services 87 – 87 –

Total auditors’ fees 467 418 372 280

PARENT SOCIETYAgreement has been reached with the Chief Executive Officer on severance pay equal to 24 months’ salary during the first year of employment, 18 months’ salary during the second year of employ-ment, and, thereafter, 12 months’ salary if notice is served by STIM for reasons other than gross negligence on the part of the Chief Executive Officer under Swedish law. The mutual period of notice is six months.


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Note 8

Current investment in new IT systems

Note 7

Distribution

2014 2013 2014 2013Distribution – performance licenses

Performance in Sweden 780,491 706,151 736,356 691,630

Performance abroad 537,710 487,688 537,710 487,688

Performance abroad distributed by STIM on behalf of others 38,375 29,214 38,375 29,214

Total performance distribution 1,356,576 1,223,053 1,312,441 1,208,532

Distribution – of mechanical reproduction licenses 161,874 186,698 161,874 186,698

Distribution – of national funds* 24,313 31,252 30,692 31,305

Total distribution 1,542,763 1,441,004 1,505,006 1,426,535

*National funds include salary and social security expenses for one employee totaling SEK 596 (564) thousand.

2014 2013 2014 2013

Opening acquisition value 5,846 33,207 5,758 33,207

Acquisitions during the year 4,156 7,185 3,029 7,097

Reclassifications -8,272 -34,546 -7,057 -34,546

Closing acquisition value 1,730 5,846 1,730 5,758

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

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Note 10

Buildings and land

2014 2013 2014 2013

Buildings

Opening acquisition value 365,116 338,960 – –

Acquisitions during the year 6,768 26,156 – –

Sales and disposals -92,182 – – …

Closing accumulated acquisition value 279,702 365,116 – –

Opening depreciation/amortization -77,321 -68,638 – –

Depreciation/amortization during the year -7,900 -8,682 – –

Sales and disposals 59,262 – – –

Closing accumulated depreciation/amortization -25,959 -77,320 – –

Closing residual value, buildings 253,743 287,796 – –

Land

Opening acquisition value 140,446 140,446 – –

Sales and disposals -11,301 – – –

Closing acquisition value, land 129,145 140,446 – –

Closing residual value, buildings and land 382,888 428,242 – –

On September 12, 2014, Stim Fastighets AB was sold, including the property Stettin 7.In the case of the property Krukomakaren 17, 56 percent of the building is held for investment purposes.

Note 9

System development costs brought forward

2014 2013 2014 2013


Acquisitions during the year 1,168 3,322 – 1,510

Reclassifications 8,272 34,546 7,057 34,546

Sales and disposals -2,164 – -2,164 –

Closing accumulated acquisition value 133,407 126,130 129,211 124,318

Opening depreciation/amortization -90,064 -83,678 -89,973 -83,678

Depreciation/amortization during the year -9,811 -6,386 -8,713 -6,295

Sales and disposals 896 – 896 –

Closing accumulated depreciation/amortization -98,980 -90,064 -97,791 -89,973

Closing residual value 34,427 36,066 31,420 34,345

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

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During the year, CEE transferred its ownership in Stimhuset KB to STIM. The limited liability owner is Stim Fastighets Holding AB.During the year, Stim Fastighets Holding sold Stim Fastighets AB (556745-2841).

Note 11

Equipment

Note 12

Participations in group companies

2014 2013 2014 2013


Acquisitions during the year 3,252 2,600 3,202 1,597

Sales and disposals -7,352 -1,393 -2,965 -671

Closing accumulated acquisition value 25,993 30,093 24,686 24,449

Opening depreciation/amortization -20,233 -16,388 -17,427 -13,927

Depreciation/amortization during the year -3,726 -4,775 -3,315 -3,710

Sales and disposals 4,770 929 2,250 210

Closing accumulated depreciation/amortization -19,189 -20,233 -18,492 -17,427

Closing residual value 6,804 9,860 6,193 7,021

SubsidiariesCorporate

identity number Reg’d office Share of equity, %Number of

shares, thousandsCarrying value

12/31/2014Carrying value

12/31/2013

CEE Services AB 556723-5923 Stockholm 100 100 100 100

Svensk Musik Swedmic AB 556754-1338 Stockholm 100 1 100 100

Kobalt STIM Aggregated Rights AB 556884-6371 Stockholm 100 50 50 50

Stim Fastighets Holding AB 556842-4880 Stockholm 100 1 50 50

Total participations in group companies 300 300

Subsidiaries, indirectly owned Corporate identity number

Reg’d office

Stimhuset KB 969696-4361 Stockholm


PARENT SOCIETY

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Note 13

Participations in joint venture and associated companies

Joint venture company, indirectly owned

Corporate identity number Reg’d office

Share of equity and votes, %

Number of shares,

thousands

Carrying value 12/31/2014

Carrying value 12/31/2013

International Copyright Enterprise Services AB

556723-5907 Stockholm 50 50,001 54,050 –

Opening balance 39,326 39,028

Translation reserve -5 –

Participation in results from joint venture companies -4,495 298

Closing balance 34,826 39,326

Note 14

Prepaid expenses and accrued revenue

2014 2013 2014 2013Accrued performance revenue 242,039 230,522 192,345 207,268

Accrued revenue, private copying levy 18,217 17,168 18,217 17,168

Prepaid expenses 6,859 6,844 5,490 4,551

Other 10,135 7,199 8,626 6,193

Total prepaid expenses and accrued revenue 277,251 261,733 224,677 235,180

GROUP

In 2014, CEE Services AB transferred its share in International Copyright Enterprise Services AB to STIM. ICE International Copyright EnterpriseServices AB established a wholly-owned German subsidiary, ICE International Copyright Enterprise Germany GmbH (HRB162426B), during the year.

GROUP

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PARENT SOCIETY

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Note 15

Changes in equity

Note 16

Non-current liabilities

2014 2013 2014 2013Restricted equity

Contributed capital 5 5 5 5

Other restricted equity 1,226 1,226 1,226 1,226

Total restricted equity 1,232 1,231 1,232 1,231

Unrestricted equity

Accumulated deficit/unrestricted equity -24,171 -22,544 5 5

Profit/loss for the year 249,709 -1,621 – –

Total unrestricted equity 225,538 -24,165 5 5

Total equity 226,770 -22,934 1,236 1,236

2014 2013 2014 2013Deposit, tenants

TUGG 71 – – –

House of Shapes 500 – – –

Total non-current liabilities 571 – – –

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

Note 17

Bank overdraft facility

2014 2013 2014 2013Utilized overdraft facility – 22,676 – 22,676

Unutilized overdraft facility – 77,324 – 77,324


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2014 2013 2014 2013Distribution – of performance revenue, Sweden

Undistributed revenue from previous years 634,923 556,019 620,401 556,019

Payment to STIM-affiliated rightsholders -249,679 -215,959 -235,157 -215,959

Payment to foreign collecting societies -132,276 -116,286 -132,276 -116,286

Outstanding payments of previous years’ revenue 252,969 223,774 252,969 223,774

Revenue for the year for distribution 818,865 735,366 774,730 720,844


Payment to foreign collecting societies -129,898 -113,475 -129,898 -113,475

Outstanding payments from revenue for the year 440,020 411,150 413,903 396,628

Outstanding payments at year-end 692,989 634,924 666,872 620,402

Distribution of performance revenue, international



Outstanding payments of previous years’ revenue 101,543 87,842 101,543 87,842





Distribution – of mechanical reproduction revenue



Outstanding payments of previous years’ revenue 0 0 0 0





Total distribution liability at year-end 907,870 823,994 881,753 809,473

Note 18

Distribution liabilities


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Note 19

Accrued expenses and prepaid revenue

Note 20

Contingent liabilities and pledged assets

CONTINGENT LIABILITIESAs of May 24, 2010, STIM agreed to stand surety for ICE Services AB’s rental agreement with Förvaltningsbolaget Alvikshus HB.

PLEDGED ASSETSAs a general security for STIM, during the year Stimhuset KB raised mortgages totaling SEK 176.0 million on the property Krukoma-karen 17 (Hornsgatan 103), as security for loans and overdraft facilities. As per December 9, 2014, the mortgage deed was transferred from SEB to Sweden’s electronic property owners archive.

2014 2013 2014 2013Prepaid performance revenue 161,320 170,708 161,320 170,708

Prepaid rental revenue 7,005 7,012 – –

Accrued vacation pay liability 3,557 3,603 3,363 2,423

Accrued social security expenses and payroll tax 3,120 3,928 2,570 2,140

Other accrued expenses 25,264 8,100 6,757 3,438

Total accrued expenses and prepaid revenue 200,266 193,351 174,011 178,709

2014 2013 2014 2013For provisions and liabilities related to liabilities to credit institutions:

Property mortgages – 176,045 – –

Total pledged assets – 176,045 – –

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

In addition, endowment insurance policies held by the parent company have been pledged as security for provided pension commitments. See Note 2.The fair value of the endowment insurance including payroll tax, as per December 31, 2014, amounted to SEK 4,605 (3,590) thou-sand.

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Note 21

Taxes

2014 2013 2014 2013Deferred income taxes

Other provisions for pensions 1,013 790 1,103 790

Total deferred tax 1,103 790 1,103 790

2014 2013 2014 2013Tax on profit for the year

Current tax for current year -245 -270 -233 -241

Current tax attributable to previous years -49 -766 25 -766

Change in deferred tax for the year 233 790 223 790

Total tax as per the income statement -71 -246 15 -217

The difference between the reported tax expense and the tax expense based on the current tax rate is explained by:

Profit/loss before tax 252,527 -1,376 -15 217

Tax based on the current tax rate -55,556 303 3 -48

Tax effect of costs that are not tax deductible -817 -73 -801 -50

Tax effect of revenue that is not taxable 56,725 27 334 27

Tax effect of change in temporary differences – -440 – –

Tax effect due to unvalued deficit deductions -828 -87 – –

Tax effect due to deduction of foreign tax 453 – 453 –

Tax attributable to previous years -49 24 25 24

Reported tax expense -71 -246 15 -217

TEMPORARY DIFFERENCESTemporary differences arise in those cases where the carrying values and values for tax purposes of assets and liabilities differ.

PENSION COMMITMENTSAs per December 31, 2014, the Group’s temporary difference with respect to pension commitments amounted to SEK 4,605 (3,590) thousand, corresponding to a deferred tax claim of SEK 1,013 (790) thousand.

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

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Note 22

Acquisition of subsidiary

2014 2013 2014 2013Cash purchase consideration on day of possession 300,989 300,989 – –

Additional purchase consideration – – – –

Acquisition-related costs – – – –

Total acquisition value 300,989 300,989 – –

2014 2013 2014 2013Paid purchase consideration previous years 300,989 300,989 – –

Buildings and land – – – –

Total purchase consideration 300,989 300,989 – –

Cash and cash equivalents in acquired company – – – –

Effect on the Group’s cash and cash equivalents – – – –

The Group’s profit/loss includes the limited partnership’s opera-tions.

In the acquisition of the limited partnership, the total value of the acquired assets and liabilities, the purchase consideration, and the

impact on the Group’s cash and cash equivalents comprised the following amounts:

On December 30, 2011, Stim Fastighets Holding AB acquired all shares in Stimhuset KB (corporate identity number: 969696-4361) for a total purchase consideration of SEK 300.6 million as specified below.

Final settlement of the purchase consideration was made in 2012 with the payment of an additional SEK 0.4 million.

GROUP

GROUP

PARENT SOCIETY

PARENT SOCIETY

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Leif Pagrotsky

Kristina Rennerstedt

Martin Q. Larsson

Erik Peters

Monica Ekmark

Eric Hasselqvist

Eva Botmar

Alfons Karabuda

Douglas Carr

Kjell-Åke HamrénChair of the Board

Karsten Dyhrberg NielsenChief Executive Officer

Anders MalmebyCertified Public Accountant

KPMG AB

Kettil SkarbyAuditor appointed by the annual general

meeting

Stockholm, Sweden, April 22, 2015

The income statements and balance sheets will be presented to the Society’s Annual General Meeting to be held on May 26, 2015 for adoption.

Our auditors’ report was submitted on April 22, 2015

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REPORT ON THE ANNUAL ACCOUNTS AND CONSOLIDATED ACCOUNTSWe have audited the annual accounts and consolidated ac-counts of Svenska Tonsättares Internationella Musikbyrå (STIM) u.p.a. for the year 2014. The annual accounts and consolidated accounts of the society are included in the printed version of this document on pages 40-64.

Responsibilities of the Board of Directors and the Chief Execu-tive Office for the annual accounts and consolidated accountsThe Board of Directors and the Chief Executive Officer are responsible for the preparation and fair presentation of these annual accounts and consolidated accounts in accordance with the Swedish Annual Accounts Act, and for such internal control as the Board of Directors and the Chief Executive Officer determine is necessary to enable the preparation of annual ac-counts and consolidated accounts that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibilityOur responsibility is to express an opinion on these annual accounts and consolidated accounts based on our audit. We conducted our audit in accordance with generally accepted auditing standards. For a certified public accountant, this entails conducting the audit in accordance with International Standards on Auditing and generally accepted auditing stan-dards in Sweden. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the annual accounts and consolidated accounts are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual accounts and consolidated accounts. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the annual accounts and consolidated accounts, whether due to fraud or error. In making those risk assessments, the auditor considers inter-nal control relevant to the society’s preparation and fair pre-sentation of the annual accounts and consolidated accounts in order to design audit procedures that are appropriate in the cir-

cumstances, but not for the purpose of expressing an opinion on the effectiveness of the society’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors and the Chief Executive Officer, as well as evaluating the overall presentation of the annual accounts and consolidated accounts. We believe that the audit evidence we have obtained is suffi-cient and appropriate to provide a basis for our audit opinions.

OpinionsIn our opinion, the annual accounts and consolidated accounts have been prepared in accordance with the Swedish Annual Accounts Act and present fairly, in all material respects, the financial position of the Parent Society and the Group as of De-cember 31, 2014 and of their financial performance and cash flows for the year then ended in accordance with the Swedish Annual Accounts Act. The statutory administration report is consistent with the other parts of the annual accounts and consolidated accounts. We therefore recommend that the annual general meeting of the society adopts the income statement and balance sheet for the Parent Society and the Group.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTSIn addition to our audit of the annual accounts and consolidat-ed accounts, we have also audited the proposed appropriation of the society’s profit or loss and the administration of the Board of Directors and the Chief Executive Officer of Svenska Tonsättares Internationella Musikbyrå (STIM) u.p.a. for the year 2014.

Responsibilities of the Board of Directors and the Chief Executive OfficerThe Board of Directors is responsible for the proposal for appropriation of the society’s profit or loss, and the Board of Directors and the Chief Executive Officer are responsible for administration under the Swedish Economic Associations Act.

Auditors’ Report To the Annual General Meeting of Svenska Tonsättares Internationella Musikbyrå (STIM) u.p.a., corporate identity number 702002-3524

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Production: Lotta Lundén, STIM, Alexandra Carmback, Publik. Text: Krister Insulander, Publik.

Photo: Peter Cederling, except pages 11 & 13, photo: Victor Gårdsäter, page 17, photo: Kristoffer Wieche, and page 21, photo: Fredrik Hjerling.

Graphic design and background photos: Wickholm Formavd.

Printers: Norra Skånes offset. Compliant with ISO 14001 and Nordic Swan. Paper: Arctic Matt 130 g. Cover: Arctic Silk 250 g.

Auditor’s responsibilityOur responsibility is to express an opinion with reasonable assurance on the proposed appropriation of the society’s profit or loss and on the administration based on our audit. We conducted the audit in accordance with generally accepted auditing standards in Sweden. As a basis for our opinion on the Board of Directors’ proposed appropriation of the society’s profit or loss, we examined whether the proposal is in accordance with the Swedish Eco-nomic Associations Act. As a basis for our opinion concerning discharge from liability, in addition to our audit of the annual accounts and consolidat-ed accounts, we examined significant decisions, actions taken, and circumstances of the society in order to determine whether any member of the Board of Directors or the Chief Executive

Officer is liable to the society. We also examined whether any member of the Board of Directors or the Chief Executive Officer has, in any other way, acted in contravention of the Swedish Companies Act, the Swedish Annual Accounts Act, or the Arti-cles of Incorporation. We believe that the audit evidence we have obtained is suffi-cient and appropriate to provide a basis for our audit opinions.

OpinionsWe recommend to the Society’s Annual General Meeting that the profit be dealt with in accordance with the proposal in the statutory administration report and that the members of the Board of Directors and the Chief Executive Officer be discharged from liability for the financial year.

Anders MalmebyCertified Public Accountant KPMG

Kettil SkarbyAuditor appointed by the annual general

meeting

Stockholm, Sweden, April 22, 2015

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Production: Lotta Lundén, STIM, Alexandra Carmback, Publik. Text: Krister Insulander, Publik.

Photo: Peter Cederling, except pages 11 & 13, photo: Victor Gårdsäter, page 17, photo: Kristoffer Wieche, and page 21, photo: Fredrik Hjerling.

Graphic design and background photos: Wickholm Formavd.

Printers: Norra Skånes offset. Compliant with ISO 14001 and Nordic Swan. Paper: Arctic Matt 130 g. Cover: Arctic Silk 250 g.

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www.stim.se

stim annual report 2014

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