Live Nation has reported a net loss of $35.4 million, or 47 cents per share, in the first-quarter ended March 31. Driven by increased ticket sales and recent acquisitions, first-quarter revenue at the Los Angeles-based live entertainment company rose to $636.5 million from $520.3 million during the same period in 2007.
During a teleconference today (May 8) call with investors, Live Nation CFO Kathy Willard reported that $35.2 million of the $116.2 million increase came from the acquisition of HOB Canada, while $24.3 million came from the acquisitions of Signatures Network and Anthill. Increased ticket revenue from strong arena acts, along with stronger attendance at mid-size venues accounted for $15.5 million of the increase.
Looking forward in 2008, Live Nation president/CEO Michael Rapino said that part of Live Nation’s North American growth will result from its live entertainment assets acquisition of Florida-based concert promoter Fantasma Productions. Other revenue generators in 2008 will come from new House Of Blues venues in Houston and Boston (expected for completion by the end of 2008), along with first-ever Pemberton Festival in British Columbia, according to Rapino.
On the international front, Live Nation hopes to see financial growth from its 65% acquisition of Dubai-based promoter Mirage Promotions, along with the company’s acquisition of Black Box Theater Exploitatie BV — the operating company for the 5,500-capacity Heineken Music Hall in Amsterdam.
Over the long-term, Live Nation’s business model “will be driven by two levers,” Rapino noted, “the acquisition of artists’ rights and the monetization of our distribution platform.” In addition to recent 360-deals with Jay-Z, U2 and Madonna, the company expects in 2008 to acquire 16,000 local concert rights, more than 40 national tour rights, and up to three global tours, according to Rapino.
Speaking specifically about Live Nation’s recently finalized deal with rapper Jay-Z, Rapino said the company expects to generate a minimum of $340 million in revenue over the $150 million agreement’s 10-year term. “The Jay-Z deal demonstrates how acquiring long-term, multiple rights … can produce higher margins than our current local concert model,” Rapino told investors.
Additionally, along with its new marketing alliance with Citi, Live Nation expects to close more than 1,000 sponsorship deals in 2008, according to Rapino.
Live Nation promotes more than 16,000 concerts annually, spending $3 billion in artist fees and costs relating to producing the shows. For the fourth-quarter ended Dec. 31, 2007, the company reported a net loss of $18.4 million, or 25 centers per share.
Live Nation’s share price closed today at $14.06.
