The overall increase across all the society’s revenue streams – including International, Public Performance, Television and Radio, Online and Recorded Media - was nearly one percent on a constant currency basis.
The online market contributed £79.7m - an increase of 17.5 percent or £11.9m year-on-year - outstripping for the first time the royalties collected from the declining physical product sector, which was down 21.8 percent to £63.1m.
Streaming royalties (£38.8m) also exceeded those of downloads (£26.7m) for the first time, however the society said this transition had resulted in a corresponding increase in the volume of usage data processed, from 136 billion to 250 billion individual usages.
Elsewhere, revenues from the licensing of on-demand TV and film services grew strongly in 2014 with new deals established with Netflix, Microsoft Xbox and Sony Playstation.
The popularity of UK songwriters and composers’ repertoires continued across the globe and drove significant export revenue, with £188.2m in royalties collected by PRS for Music from overseas markets.
Mumford & Sons, Sam Smith and James Napier, Disclosure, Charli XCX and Ed Sheeran were notable successful global exports in 2014, the society said.
Despite the harsh global economic environment - particularly across the Eurozone – it maintained its export position on a constant currency basis to deliver nearly £1m more than 2013.
Revenue from emerging markets grew significantly as Latin America, Africa and the Middle East delivered 37.8 percent growth on 2013.
Elsewhere, Asia Pacific, dominated by the developed markets of Australia and Japan, showed growth of 2.2 percent on a constant currency basis.
Revenue from the public performance of music rose by £6m to a new high of £168.3m.
There were increases across all major tariff areas with the exception of pubs and clubs, which continued to show a decline in the use of music.
PRS for Music also saw growth in the cinema sector following the conclusion of monitoring initiatives, which resulted in an 11.5 percent rise in conjunction with efficiency improvements.
Television and radio continued to provide significant income to PRS for Music members with revenues of £165m, an increase of 2.9 percent on 2013.
Commercial radio - driven by a recovery of the advertising market – helped radio revenues grow by 3.3 percent to £49m, while new licences with 25 television channels including Bollywood broadcaster B4U and 13 local TV channels contributed to the growth.
The society said it had achieved its overall growth with a cost to revenue ratio of 11.4 percent - one of the lowest rates of any collecting society in the world.
Robert Ashcroft, chief executive of PRS for Music, said: ‘Despite the impact of a challenging economic backdrop in key international territories, a strong pound and the decline of the physical market, we managed to achieve our budgeted revenues in 2014.
‘We work hard to provide an outstanding service to members with the lowest possible charge to them. Despite the potential disruption of two office moves, a major systems upgrade and a dramatic increase in the volume of music usage to process we managed to contain our costs to within budgeted levels while at the same time increasing our distribution frequency to ensure that the money reached our members more swiftly than ever before.
‘Though there remains much more to be done as we modernise PRS for Music’s operations, this was nonetheless a landmark performance in our centenary year.’
The 2014 PRS financial results will be presented at the Annual General Meeting at the British Library Conference Centre on 19 May 2015.