Admitting that ticket pricing was “too aggressive” for some of the company’s summer concerts this year, Live Nation Entertainment reported less than stellar earnings for the quarter ended June 30, missing analyst projections with a 10 percent drop in revenues to $1.27 billion and a growth in net loss to $34.6 million.
The ticketing and live entertainment giant produced nearly 3 percent fewer shows during the quarter than it did for the same period in 2009, and total attendance dropped nearly 6 percent to 12.4 million. On average, analysts expected the company’s revenues to grow in the second quarter to about $1.36 billion, compared to the second quarter in 2009.
In a prepared statement prior to an earnings conference call earlier today, August 5, President and CEO Michael Rapino tried to downplay the decreases. In addition, he said the company’s goal for the remainder of the year is to continue to “drive revenue and reduce costs.”
“Our second quarter results were in line with our plan and financial guidance for the full year. Our performance to date reflects the impact of the uncertain economy on consumers, offset in part by our efforts to aggressively promote, price and expand access to concerts across our global platform,” he said. “We have now largely completed the integration of Live Nation and Ticketmaster and we are generating considerable progress in driving efficiencies across our combined business. As we head into our biggest quarter, we are executing a range of revenue enhancement programs, while taking additional steps to reduce our operating expenses.”
While the merger with Ticketmaster has largely been completed, the company has instituted a hiring freeze, Rapino said, and added that new sponsorship opportunities are not entirely firmed up for the remaining two quarters of the year.
“It’s all about execution at this point,” he said during the conference call. The company’s stock, which trades under the symbol LYV, closed down almost 3 percent today at $9.46.
Average ancillary expenditures by fans rose slightly during the quarter to $18.59, compared to $18.46 for the same period in 2009.
The company believes it will still reach its projected adjusted operating income number of $405 million for the year, and company Chairman Irving Azoff, who made a splash this week by starting a Twitter account, said he expects 2011 to be a solid year. Among the acts expected to tour in 2011 include U2, Christina Aguilera and Journey. But, the company’s long term debt is $1.7 billion.
“As we look to the future, we are more confident than ever in our belief that Live Nation Entertainment has a unique business model to service artists and fans,” Azoff said.