Thursday, March 26, 2009
Ticketmaster Loses 1 Billion Dollars
Ticketmaster Posts Loss of $1.07 Billion
By ETHAN SMITH
Citing declining ticket sales, costs associated with layoffs and a massive impairment charge, Ticketmaster swung to a loss of $1.07 Billion on revenue of $384 Million in the last three months of 2008, the company reported Thursday.
The results could bolster the ticketing company's contention that adverse economic conditions are part of what is forcing it to merge with concert promoter Live Nation.
Ticketmaster shares closed at $4.09 in 4PM Nasdaq Stock Market trading, down less than 1% but significantly below a 52-week high of $27.
The loss compares with net income of $51.1 Million in the fourth quarter of 2007.
Excluding the impairment charge, net income for the latest quarter fell 81% to $9.9 Million, or 16 cents a share; FactSet Research Systems had expected earnings of 29 cents a share.
For the year, net income excluding the impairment charge declined 56% to $74.7 Million.
In a conference call discussing the results, Chairman Barry Diller lashed out at politicians and others who have raised questions about the company's proposed merger. Mr. Diller singled out New York Senator Chuck Schumer for engaging in what the executive called "always-to-be-expected shameless grandstanding."
Senator Schumer aggressively questioned Ticketmaster's chief executive, Irving Azoff, during a hearing last month on the merger. The deal would create an unprecedented music-industry powerhouse, dominant in ticket sales, concert promotion, venue operation and artist management. That has created a controversy, with competitors and others in the business complaining that the company would have too much power.
On Thursday, a spokesman for Senator Schumer, Brian Fallon, said "concertgoers would be better off if Mr. Diller provided cheap seats instead of cheap shots."
The bulk of Ticketmaster's loss was because of a $1.1 Billion charge the company took because of a precipitous decline in its share price since being spun off from IAC/InterActiveCorp last year. The fourth-quarter revenue represented an increase of 9.4% from the year-earlier period, mainly because of acquisitions, the company said.
The company incurred a loss of $18.82 a share, compared with income of 91 cents a share in the fourth quarter of 2007.
For the full year, Ticketmaster reported revenue of nearly $1.5 billion, a 17% increase from 2007, thanks to its acquisitions of Front Line Management, resale service TicketsNow and Paciolan, a college-sports ticketing company. The company said its revenue from ticketing amounted to about $1.4 Billion, for 141.9 Million tickets sold -- an average of 3% more per ticket than it reaped in 2007.
The company posted a net loss of $954 million for the year, thanks to the impairment charge.
The merger is one of several controversies currently facing the company. Mr. Diller also addressed the company's attempts to capitalize on the so-called secondary market in tickets, which has been controversial, because it has appeared to serve as a way for artists to charge more than face value for their concert tickets while pretending they are actually being resold by fans.
Mr. Diller apologized for the flap. "We are in the early stage of our efforts and we're learning all the time," Mr. Diller said. "While we've certainly made our mistakes, they've been of omission, not commission."
During the call, Ticketmaster President Eric Korman called the episode "a setback for us," which Mr. Azoff said generated "disappointing headlines."
posted 8:49 AM