Restructuring, Possible Layoffs to Come at SFX
CEO Robert Sillerman said the company has decided to consolidate many of its operations and hinted at "reductions in workforce" during Friday's earnings call.
Change is on the horizon at SFX. During Friday’s earnings call, Robert Sillerman, chairman and chief executive, said the company has “made a very significant decision to consolidate many of our operations, and going forward you can expect to see a not insignificant shift in assignments and reduction in workforce, all of which will go to improve efficiency and, of course, to improve our EBITDA [earnings before interest, taxes, depreciation and amortization].”
In a statement to Billboard Friday evening, Sillerman emphasized restructuring over downsizing. “Having completed many acquisitions, we are in the process of determining where there is duplication, as well as where we can enter new businesses by reallocating people,” he said. “There are no specifics beyond that at this time.”
SFX’s online properties could be affected by the upcoming changes. Chief financial and administrative officer Richard Rosenstein said SFX has consolidated its online properties through Beatport and, after next month’s re-launch, SFX will seek to “better rationalize and streamline these efforts” through cost savings and other initiatives.
“As a result, platform and overhead expenses will come down in the fourth quarter and throughout 2015,” he said.
Earlier today, Billboard reported strong numbers from the company’s festival arm. Third quarter revenue increased 19.4 percent to $143.5 million, with about 80 percent coming from live events. The remaining 20 percent came from “platform revenue,” SFX’s name for out-of-concert engagement such as Beatport download sales, ticketing fees, and marketing activitites.