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Live Nation Entertainment, Inc. Today released its financial results for the quarter ended Dec.31, 2020. The company’s concert revenues fell to $ 1.46 billion for 2020 from $ 9.43 billion the year before, and ticket sales fell to $ 188.4 million from $ 1.54 billion in the same period, and sponsorship and advertising declined to $ 203.7 million from $ 590.3 million. Living nation ended 2020 with $ 1.86 billion in revenue, down 84% from the previous year, with a 92% drop in revenue in the fourth quarter.
Living nation CEO Michael rapino said in a statement: “Over the past year, leaders across all of our concert, ticketing and sponsorship businesses have analyzed ways to improve their businesses. Some of our key initiatives include: reorganization to become more agile while reducing our cost structure by $ 200 million; Creating streaming concerts and direct to consumer businesses to expand our revenue streams; Advancing our technology initiatives globally while accelerating the shift to digital tickets to meet the changing needs of fans, venues and artists; and strengthening our balance sheet to last this period, while maintaining a strong position to build our business for the future and act on opportunities at as we identify them, such as our recent acquisition of the streaming platform Veeps and an ongoing pipeline of targeted acquisitions around the world.
“So while this past year has been a difficult one for the company, our employees, our fans, our artists and so many others globally affected by COVID, I have never been so excited about the opportunities that lie ahead. we.
“We continue to have positive winds in the live events industry as consumers look more than ever to spend on experiences. Supply and demand fundamentals in the concert industry remain strong, with hit-the-road performers and impatient fans All of our data continues to show that there is a strong pent-up demand for concerts on the consumer demand side. The projected $ 2.4 trillion savings surplus to United States alone by June is a key indicator of consumer spending potential. At the same time, surveys show high demand for concerts around the world, with 95% of fans likely to attend a show when restrictions are lifted This is also reflected in the behavior of fans, 83% of fans keeping their tickets to rescheduled shows.
“On the performer side, there is a broad desire to get back on stage – to connect with their fans and provide economic support to their bands, their team and the hundreds of other employees every night to put the show on. Considering the limited number of touring activity in 2020 and 2021, the pipeline for 2022 is much stronger than usual, with nearly twice as many great artists on cycle touring in 2022 than a typical year – around 45 artists. compared to the usual 25. And there is still plenty of availability of schedules in arenas, amphitheatres, and stadiums to accommodate these additional visits, with over two-thirds of the nights at these venues unused by major sporting events or concerts in a typical year. .
“It seems the time to release pent-up supply and demand is now approaching. Vaccine distribution is accelerating and the decline in the number of Covid cases in most countries of the world gives us even more confidence than a Safe and meaningful return to emissions will soon be possible. – For the US and UK, projections indicate that anyone who wants to get vaccinated will be able to do so by May or June, Europe and most of other markets following a few months later. has had on the public, we think there will be a strong momentum to quickly reopen the company as soon as vaccines become readily available and we believe that outdoor activities will be the first to happen.
“So while the timing of our return to life continues to vary in global markets, each sign indicates that it is starting safely in many countries this summer and evolving even further.
At the end of the fourth quarter of 2020, Living nation had total cash and cash equivalents of $ 2.5 billion, of which $ 643 million was free cash. This free cash, combined with $ 962 million of available debt capacity and taking into account the additional $ 417 million in net cash added to the balance sheet with the increase in debt at the start of January, gives Company 2, 0 billion dollars of available cash. The company believes that this level of liquidity gives it the ability to finance its operations until the expected return of concerts in summer 2021, preceded by ticket sales earlier in the year.
The overall refund rate for Company concerts that are rescheduled and that are or have gone through a refund window is 17% until the end of the fourth quarter of 2020. Festivals have generally canceled this year’s event. , but for festivals where fans can keep their tickets to next year’s show, around 63% of fans keep their tickets.
For both concerts and festivals, since March the company has reimbursed $ 282 million for Living nation shows and $ 842 million for cancellation Living nation shows. Of this total of $ 1.1 billion, $ 460 million came from funds held by third-party sites and $ 663 million came from Living nation– funds held.
The company still has issues that are being rescheduled, or that are being postponed but not yet offering refunds. Additionally, refunds may arise in the future for additional cancellations or postponed events resulting from the global shutdown of our live events. Based on current and future impacted events and fan behavior, Living nation recorded $ 102 million in additional refunds to fans of Living nation– funds held. As a result, the Company has reclassified these funds from deferred revenue to accumulated ticket refunds as of the fourth quarter of 2020.
The company’s deferred revenue for events over the next 12 months was $ 1.5 billion as at December 31, 2020, up from $ 1.4 billion as at September 30, 2020. This increase was due to ticket sales for future events and sales of events planned for the fourth quarter of 2021 change from long-term deferred income to current deferred income as well as currency effects Living nationinternational deferred income balances of.
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