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MSG Entertainment pushed the lower end of its expected range for revenue, operating income and adjusted operating income (AOI), the company announced on Thursday’s third-quarter earnings call.
Full-year sales forecasts have been raised to $940-$950 million from $930-$950 million. Operating income rose from $95 million to $105 million to $100 million to $110 million. AOI improved from $195 million to $205 million to $200 million to $210 million.
The New York City-based live entertainment company had mixed results for the period ended March 31, 2024. Sales increased 13% to $228.3 million, while operating income decreased 32% to $16.8 million and adjusted operating income decreased 23% to $38.5 million.
Net income was $2.8 million, or $0.06 per share. Analysts had expected earnings of $0.17 per share, according to data compiled by Thomson Reuters.
MSG Entertainment stock fell as much as 12.7% to $34.83 in early trading Thursday. It recouped some of its losses, falling 6% to $37.47 by midday.
At Thursday’s financial results conference, mike grauThe executive vice president and chief financial officer said the company’s results for the quarter were due to “record revenue” from its 90th season. Christmas Spectacular Starring Radio City Rockettes The reservation business is expected to achieve “a low double-digit growth rate in the number of events in 2024.” He added that the majority of concerts in the quarter were sold out and per capita spending on food, beverages and merchandise increased from the same period last year.
AOI was impacted by an increase in selling, general and administrative expenses (SG&A), Grau said, noting that since MSG Entertainment was spun off from Sphere Entertainment in April 2016, its expenses were “completely down year over year.” There’s no comparison,” he added. “The results for the same period last year are based on carve-out accounting and do not reflect all of the SG&A expenses that we would incur,” he noted.
MSG Entertainment continued to experience strong demand and supply for live events, hosting more than 1.5 million guests at more than 200 live events during the quarter. “Our strong multi-night comedy schedule contributed to double-digit year-over-year growth in concert numbers,” Grau said. MSG Entertainment owns and operates famous venues including Madison Square Garden, The Theater at Madison Square Garden, Radio City Music Hall, Beacon Theater, and Chicago Theater.
Since the 2023 spinoff, MSG Entertainment has repurchased approximately 1.6 million shares, or approximately 10% of its Class A stock, and has an additional $110 million remaining in its stock repurchase plan. Additionally, the company sold 1.6 million shares of radio broadcaster Townsquare Media during the first four months of calendar 2024 for approximately $15.6 million.