The Beat: Quarterlies

26 May


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Live Nation Entertainment (NYSE: LVY)

Tuesday’s close: $13

First quarter activity: Traded as low as $9.12 on Jan. 4 and as high as $14.25 on March 8

Market cap: $2.2 billion

Comments: After completing its merger with Ticketmaster and enjoying an aggressive first quarter of growth, Live Nation Entertainment stock is trading slightly down from its March first quarter peak, and substantially down from its mid-April position at $16.

During its earnings call on May 11, CEO Michael Rapino reported that the company has seen concert attendance slip 3 percent over the same period last year. The company reported a loss of $112 million, or 76 cents per share, compared with $102.7 million last year. The company has 84 percent more shares outstanding, following its merger with Ticketmaster.

Company revenue increased about 49 percent to $723 million, mostly by combining the two firms. According to Rapino, concert attendance fell to 6.8 million from 7.1 million a year ago, while total spending per customer increased 2 percent to $59.71.

“During the first quarter, we moved forward with integrating our operations, streamlining our cost structure and strengthening our balance sheet,” Rapino said during the earnings call.  “We remain on track in eliminating redundancies and driving a minimum of $40 million in merger synergies across our operations in 2010. Our core concert and ticketing businesses are entering the busiest time of the year and show count and ticket sales globally remain on track to achieve our plan for 2010.”

Contact: Michael Rapino, (310) 867-7127

World Wrestling Entertainment (NYSE: WWE)

Tuesday’s close: $16.98

First quarter activity: Traded as low as $15.60 on Jan. 4 and as high as $18.04 on March 10

Market cap: $1.2 billion

Comments: Revenues totaled $138.7 million as compared to $107.8 million in the prior year. Operating income was $37.3 million as compared to $16.7 million in the prior year. Net income was $24.7 million, or $0.33 per share, as compared to $10.3 million, or $0.14 per share in the prior year.

During an investor call on May 6, chairman Vince McMahon said a big part of the company’s success was tied to moving the company’s marquee Wrestlemania event from April to March, placing it in the first quarter.

“WrestleMania XXVI attracted more than 70,000 fans and contributed profits of over $13 million for the second consecutive year,” he said. “We remain confident that we can achieve our targeted earnings growth and drive greater profits.”

WrestleMania XXVI contributed approximately $28.8 million of revenues this quarter. The results also reflect an infrastructure tax credit, which reduced depreciation and amortization by $1.6 million. In addition, the first quarter results included approximately $2.2 million of restructuring related expenses associated with layoffs that occurred in January 2009. North American revenues increased 28 percent while international revenues were up 33 percent.

Contact: Vince McMahon, (203) 352-8600

Madison Square Garden (NASDAQ: MSG)

Tuesday’s close: $21.89

First quarter activity: Traded as low as $18.89 on March 11 and as high as $22 on March 26

Comments: Earlier this year, Madison Square Garden was spun off by former owner Cablevision. Its first quarter 2010 revenues increased 9 percent to $306.5 million compared to the prior year period, primarily reflecting an increase in revenue from its media division and its touring shows revenues.

First quarter net income was $19.3 million compared to a loss of $1.9 million in the prior year period.

“Looking ahead, we are confident in the long term growth potential that our unique assets and integrated approach create for each of our three business segments,” CEO Hank Ratner said in a conference call on May 4. “Separately, we are pleased with our progress on the upcoming renovation of Madison Square Garden, which will transform the arena into a state-of-the-art facility and deliver positive returns for our shareholders in the years ahead.” — Dave Brooks

Contact: Hank Ratner, (212) 465-5800

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