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| Dan |
Pollstar Daily News ServiceLN 1Q Earnings
Posted Thursday, May 10, 2007 at 3:00 pm
Despite a $584 million boost in revenue, Live Nation has announced its first quarter earnings call May 10th was punctuated by a downturn -- a $45.6 million mark in the debit column, attributed to a lack of powerhouse tours.
It also revealed the company plans to reduce the number of its amphitheatre shows, cut its contracts with third-party local food and beverage vendors, and implement a new program called "Artist Nation."
On the money end of the call, Live Nation reported revenue of $584.2 million, an increase of $67.6 million (or 13.1 percent) compared to the same period in 2006, and operating loss of $30.4 million, a decline of $38.5 million.
However, the adjusted EBITDA of $4.1 million is a decline of $12.1 million for a net loss of $45 million.
Asset sales in the first quarter alone yielded $37.6 million in net proceeds, reflecting the divestiture of Donington Racetrack in the United Kingdom, Starwood Amphitheatre near Nashville and Live Nation’s remaining stake in "Phantom – The Vegas Spectacular" as well as an office building in San Francisco.
Live Nation reported a softer first quarter in concert revenue, citing the difference a Rolling Stones tour can make. The lack of Stones dates in the first quarter was offset somewhat by the addition of House of Blues shows to the box office tally in 2007.
The company reported 20.5 percent more shows held, for an increase in attendance of 1.5 million, or 12.8 percent. Still, the mix of shows in the first quarter, including The Who, Josh Groban, Bob Seger, and Rascal Flatts weren’t quite strong enough to keep up with last year’s early tours including U2, Coldplay, Billy Joel, Aerosmith, Toby Keith, and Depeche Mode.
Looking ahead, Live Nation announced it is taking steps to stop some of the bloodletting at its amphitheatres by severely cutting back on shows that draw fewer than 7,500 concertgoers.
"We are targeting a lower number of events this summer with a focus on eliminating unprofitable events and improving profitability of the remaining events," Live Nation said in a statement.
Another cost-cutting initiative announced in the earnings call is the reduction of the number of different goodies for sale at venues and the elimination or reduction of "low-margin third-party local food and beverage vendors." The number of F&B items available is expected to be reduced to about 50 from more than 200.
Live Nation also introduced a potential new revenue stream with the introduction of Artist Nation, which consolidates all of LN’s artist service businesses under the Global Artists segment. Artist Nation includes LN’s interest in fan portal MusicToday, merchandiser Trunk Ltd., content and marketing developer Ultrastar and tour marketing/creative services unit Tour Design.
The company previously announced the launch of exclusive ticketing offers, including the sale of premium seat, parking and VIP passes through the Live Nation Web site. Divestiture of Live Nation’s theatrical division and additional amphitheatre properties is continuing.
"We are one year into our three year transformation to become a vertically intergrated live music company," Live Nation CEO Michael Rapino said. "We have demonstrated quarter after quarter our ability to execute systematically on our fix/build/expand strategy to get us to that goal.
"Year one was about stabilizing our core music business and refocusing our mission. Now, with a defined music mission, year two is about improving the core, expanding our core music offerings. … Year three will see our growth being propelled by the synergy of our core live, online and artist services businesses."
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| gimmekeef |
So if they didnt sell the track etc....they lose almost 70 million on sales of 537 or so....And this guy still has his job?.....Hope he's beggin Mick for a fall US Mini tour!!!!..The ATL beckons............................. |
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| monkey_man |
The office building they sold in SF was the Bill Graham Presents HQ's. |
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| Jumping Jack |
Where would Rapino be without Cohl on the board? It is only a matter of time before Cohl takes his job! |
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