Live Nation Revenue Up 8% to $5.8 Billion, Posts Significant Net Losses

Live Nation grew revenue 8.1% to $5.8 billion and adjusted operating income rose 4.8% to $459 million in 2012. It achieved its goals of growing concert attendance, ticket sales and sponsorship and advertising revenue. Yet its financial statements, released Tuesday afternoon, showed more red ink. Live Nation's 2012 net loss nearly doubled to $163 million from $83 million in 2011 due to a one-time charge from Irving Azoff's December 31st departure from the company.

Shares of Live Nation closed down 1.9% to $10.12 and were down 0.7% in after-hours trading late Tuesday afternoon. The company's 52-week high is $10.76.
 
Revenue in the concerts division grew 10.4% to  $3.87 billion but brought in only $31.4 million in adjusted operating income. The number of North American concerts was down 3.7% to 14,962 while the number of International concerts was up 4.1% to 7,000. North American attendance was up 3% to 32 million while International attendance was up 6.4% to 16.8 million. The concert division's festival attendance was approximately 3.5 million, a 30% increase over 2011. EDM festival attendance doubled to 1.4 million attendees.

Ticketmaster revenue grew 4.1% to $1.37 billion while adjusted operating income grew 5.6% to $294.6 million, or 64.2% of the company's total adjusted operating income. The gross value of tickets sold by Ticketmaster increased 8.4% to $9.1 billion and the number of tickets sold increased 4.5% to 147.7 million.
 
The Sponsorships & Advertising division grew revenue 7.4% to $247.9 million and raised its adjusted operating income 6.4% to $175.6 million, or 38.2% of the company's total adjusted operating income. 
 
Artist Nation posted an operating loss in both the fourth quarter and the full year. The division generated $400 million in revenue but had two unusual items in the fourth quarter. First, there was a $5.5 million charge related to the departure of former executive chairman Irving Azoff on December 31. Second, Live Nation took a one-time charge of $62.7 million related to "certain client/vendor relationship intangibles" based on expectations of future cash flows of the division. The company says the current book value of Artist Nation, set at the time of the merger with Ticketmaster, is high relative to to the net present value of future cash flows of the division. The one-time charge was taken to bring current profitability in line with Artist Nation’s book value. [An earlier version said this charge was related to Azoff’s departure. That was incorrect. Live Nation says its business will not be materially impacted by Azoff’s departure from the company.]
 
Ticket sales are up in early 2013. Through 2013, Ticketmaster sales for events in 2013 are up 10% compared to the same point last year with an 11% in North America and a 5% increase internationally.