The Madison Square Garden Company has reported its financial results for the last three months of 2014, with net profits rising 1% quarter-on-quarter to hit US $61.2m in the period.
Second quarter revenues of $542.5 million grew 7% compared to the prior year quarter. This was primarily due to an increase in revenues in the Company’s MSG Entertainment and MSG Sports segments, as well as the MSG Media segment, excluding the impact of prior year quarter Fuse revenues as the Company completed its sale of the network on July 1, 2014.
The increase in revenues in the MSG Entertainment segment includes the positive impact of the Forum being open in the fiscal 2015 second quarter, versus being closed for renovation during the prior year quarter.
Adjusted operating cash flow (“AOCF”)(1) of $149.8 million increased 18%, as compared to the prior year quarter, due to improved AOCF results in all three of the Company’s business segments, partially offset by an increase in unallocated corporate expenses (“Other”).
President and CEO Tad Smith said, “Our Company delivered double-digit AOCF growth in the second quarter as we benefited from the full availability of the Forum and The Garden, as well as broad-based organic growth. Additionally, we are continuing to explore the possible separation of our businesses and believe that the creation of two distinct publicly traded companies would provide both new entities with greater flexibility to pursue their own business plans, while enabling investors to evaluate more clearly each company’s unique assets and potential.”
The Madison Square Garden Company is comprised of three business segments: MSG Sports, MSG Media and MSG Entertainment.
MSG Entertainment posted Q2 revenues of $194.1 million, an increase of 19%. The increase was primarily due to higher event-related revenues at the Forum, the Madison Square Garden Arena and The Chicago Theatre, an increase in revenues for the Radio City Christmas Spectacular franchise (primarily due to the production at Radio City Music Hall), and higher venue-related sponsorship and signage and suite rental fee revenues.
This was partially offset by lower event-related revenues at Radio City Music Hall (excluding the Radio City Christmas Spectacular). Second quarter AOCF of $56.1 million increased 33% and operating income of $52.3 million increased 37%, both due to the increase in revenues, partially offset by an increase in direct operating expenses. The increase in direct operating expenses was primarily due to higher event-related operating expenses, mainly a result of the increase in the overall number of events held at the Company’s venues.Music Business Worldwide