Atlanta Braves Holdings Reports First Quarter 2024 Financial Results
Atlanta Braves Holdings, Inc. reported a 20% growth in total revenue to $37 million in the first quarter of 2024. Baseball revenue increased by 25% to $22 million, and mixed-use development revenue rose by 13% to $15 million. Adjusted OIBDA was $10 million for the mixed-use development segment. The company completed various capital improvement projects, including new spaces and retail store expansions. Operating costs increased, resulting in an operating loss and an Adjusted OIBDA loss for the quarter.
- Total revenue increased by 20% to $37 million in Q1 2024.
- Baseball revenue grew by 25% to $22 million.
- Mixed-use development revenue increased by 13% to $15 million.
- Completed capital improvement projects for the 2024 season, enhancing fan experience and generating revenue.
- Adjusted OIBDA for mixed-use development segment was $10 million.
- Operating loss and Adjusted OIBDA loss increased in the first quarter due to higher operating costs.
- Baseball operating costs rose, driven by increased player salaries and expenses.
- Selling, general, and administrative expense remained relatively flat for the quarter.
Insights
The Atlanta Braves Holdings' first quarter financial results show a substantial and positive 20% increase in total revenue, indicating growth in their core businesses. Such a rise in revenue is typically a strong indicator of a company's performance and for sports franchises, it often reflects successful marketing and sales efforts, as well as media-related earnings. Despite this, we observe an increase in operating losses and Adjusted OIBDA losses, which rose by 6% and 8% respectively, suggesting that while the company is growing its top line, it is also facing higher expenses -- notably in areas such as player salaries and spring training costs.
The stark 136% increase in broadcasting revenue can be attributed to the timing of the regular season start and underscores the importance of broadcast rights in the sports industry's revenue mix. The growth in this area might appeal to investors as a sign of stable, long-term revenue potentials, taking into account that broadcasting contracts are typically multi-year agreements providing consistent income streams. The 13% uptick in mixed-use development revenue is also significant, showcasing the potential of leveraging real estate assets to diversify revenue sources beyond the seasonal nature of baseball-related income. However, stakeholders should remain vigilant about the rising costs and their potential to erode the bottom line.
In evaluating the Atlanta Braves Holdings' financial results, the growth in ticket demand and attendance at spring training games is a noteworthy highlight. It points to a healthy fan engagement level, which is important for sports franchises as it often correlates with merchandise sales, game-day revenue and brand sponsorship. The consistent investment in capital improvements like the Lexus Premium Boxes and the Jim Beam Bourbon Decks suggests a strategy focused on enhancing fan experience and potentially increasing average revenue per user (ARPU). Such enhancements can have long-term benefits in terms of fan loyalty and spending.
It is also vital to consider the variable nature of sports-related revenues. Without regular season home games in both periods compared, the timing of revenue recognition can be uneven and may not fully reflect underlying business performance. Investors should be mindful of the seasonal fluctuations inherent in sports earnings and should consider looking at annualized or multi-year trends for a clearer financial trajectory.
The Atlanta Braves Holdings' mixed-use development's 13% revenue increase is an interesting aspect, as it reflects the successful integration of real estate into their overall revenue strategy. The use of the Battery Atlanta mixed-use facilities contributes a significant portion to the revenue, which is important for the diversification of their income sources. Real estate elements such as tenant recoveries and new lease agreements, as well as increased parking revenue, demonstrate the potential for sports franchises to create synergies between their core operations and real estate investments. This strategy not only buffers against the seasonality of sports revenues but also taps into consistent income streams from leases and rentals.
Long-term, the focus on building and maintaining a vibrant mixed-use development can contribute to a robust ecosystem that supports and boosts the sports franchise's value, enhancing stakeholder value. However, investors should also be aware of the risks associated with property management, such as occupancy rates, lease renewals and property maintenance costs, which can impact the profitability of these assets.
Headlines include:
-
Total revenue grew
20% to$37 million -
Baseball revenue up
25% to$22 million -
Mixed-use development revenue up
13% to$15 million
-
Baseball revenue up
-
Mixed-use development generated
$10 million - Completed several capital improvement projects in advance of the 2024 season, including new spaces such as Lexus Premium Boxes, Blue Moon Beer Garden and Jim Beam Bourbon Decks and expanded retail store
Discussion of Results
|
|
Three months ended |
|
|
|||||||
|
|
March 31, |
|
|
|||||||
|
|
2023 |
|
2024 |
|
% Change |
|||||
|
|
amounts in thousands |
|
|
|||||||
Baseball revenue |
|
$ |
17,561 |
|
|
$ |
21,970 |
|
|
25 |
% |
Mixed-use development revenue |
|
|
13,411 |
|
|
|
15,110 |
|
|
13 |
% |
Total revenue |
|
|
30,972 |
|
|
|
37,080 |
|
|
20 |
% |
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|||
Baseball operating costs |
|
|
(36,771 |
) |
|
|
(45,207 |
) |
|
(23 |
)% |
Mixed-use development costs |
|
|
(1,931 |
) |
|
|
(2,253 |
) |
|
(17 |
)% |
Selling, general and administrative, excluding stock-based compensation |
|
|
(23,657 |
) |
|
|
(23,374 |
) |
|
1 |
% |
Adjusted OIBDA |
|
$ |
(31,387 |
) |
|
$ |
(33,754 |
) |
|
(8 |
)% |
|
|
|
|
|
|
|
|
|
|||
Operating income (loss) |
|
$ |
(49,257 |
) |
|
$ |
(52,355 |
) |
|
(6 |
)% |
|
|
|
|
|
|
|
|
|
|||
Regular season home games in period |
|
|
— |
|
|
|
— |
|
|
|
|
Unless otherwise noted, the following discussion compares financial information for the three months ended March 31, 2024 to the same period in 2023.
Baseball revenue is derived from two primary sources on an annual basis: (i) baseball event revenue (ticket sales, concessions, advertising sponsorships, suites and premium seat fees) and (ii) broadcasting revenue (national and local broadcast rights). Mixed-use development revenue is derived from the Battery Atlanta mixed-use facilities and primarily includes rental income.
The following table disaggregates revenue by segment and by source:
|
|
Three months ended |
|
|
|||||||
|
|
March 31, |
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|
|||||||
|
|
2023 |
|
2024 |
|
% Change |
|||||
|
|
amounts in thousands |
|
|
|||||||
Baseball: |
|
|
|
|
|
|
|
|
|||
Baseball event |
|
$ |
1,118 |
|
$ |
1,168 |
|
4 |
% |
||
Broadcasting |
|
|
891 |
|
|
|
2,101 |
|
|
136 |
% |
Retail and licensing |
|
|
4,375 |
|
|
|
5,653 |
|
|
29 |
% |
Other |
|
|
11,177 |
|
|
|
13,048 |
|
|
17 |
% |
Baseball revenue |
|
|
17,561 |
|
|
|
21,970 |
|
|
25 |
% |
Mixed-use development |
|
|
13,411 |
|
|
|
15,110 |
|
|
13 |
% |
Total revenue |
|
$ |
30,972 |
|
|
$ |
37,080 |
|
|
20 |
% |
No regular season home games were played in either the first quarter of 2024 or the prior year period.
Baseball revenue increased
Operating loss and Adjusted OIBDA loss increased in the first quarter. Baseball operating costs increased primarily due to higher player salaries and minor league team and player expenses, as well as increased spring training related expenses. Selling, general and administrative expense was relatively flat in the first quarter.
FOOTNOTES
1) |
For a definition of Adjusted OIBDA (as defined by ABH) and the applicable reconciliation, see the accompanying schedule. |
Important Notice: Atlanta Braves Holdings, Inc. (Nasdaq: BATRA, BATRK) will be available to answer questions on Liberty Media’s earnings conference call which will begin at 10:00 a.m. (E.T.) on May 8, 2024. The call can be accessed by dialing (877) 704-2829 or (215) 268-9864, passcode 13742817 at least 10 minutes prior to the start time. The call will also be broadcast live across the Internet and archived on our website. To access the webcast go to https://www.bravesholdings.com/investors/news-events/ir-calendar. Links to this press release will also be available on the ABH website.
This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, product and marketing strategies, future financial performance and prospects and other matters that are not historical facts. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, ABH’s historical financial information not being representative of its future financial position, results of operations, or cash flows, ABH’s ability to recognize anticipated benefits from the Split-Off, possible changes in the regulatory and competitive environment in which ABH operates (including an expansion of MLB), the unfavorable outcome of pending or future litigation, operational risks of ABH and its business affiliates, including operations outside of the
NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTAL DISCLOSURES
SCHEDULE 1: Reconciliation of Adjusted OIBDA to Operating Income (Loss)
To provide investors with additional information regarding our financial results, this press release includes a presentation of Adjusted OIBDA, which is a non-GAAP financial measure, for ABH together with reconciliations to operating income, as determined under GAAP. ABH defines Adjusted OIBDA as operating income (loss) plus depreciation and amortization, stock-based compensation, separately reported litigation settlements, restructuring, acquisition and impairment charges.
ABH believes Adjusted OIBDA is an important indicator of the operational strength and performance of its businesses by identifying those items that are not directly a reflection of each business’ performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. Because Adjusted OIBDA is used as a measure of operating performance, ABH views operating income as the most directly comparable GAAP measure. Adjusted OIBDA is not meant to replace or supersede operating income or any other GAAP measure, but rather to supplement such GAAP measures in order to present investors with the same information that ABH management considers in assessing the results of operations and performance of its assets.
The following table provides a reconciliation of Adjusted OIBDA for ABH to operating income (loss) calculated in accordance with GAAP for the three months ended March 31, 2023 and March 31, 2024.
|
|
Three months ended |
||||||
|
|
March 31, |
||||||
(amounts in thousands) |
|
2023 |
|
2024 |
||||
Operating income (loss) |
|
$ |
(49,257 |
) |
|
$ |
(52,355 |
) |
Stock-based compensation |
|
|
3,191 |
|
|
|
3,719 |
|
Depreciation and amortization |
|
|
14,679 |
|
|
|
14,882 |
|
Adjusted OIBDA |
|
$ |
(31,387 |
) |
|
$ |
(33,754 |
) |
Baseball |
|
$ |
(35,835 |
) |
|
$ |
(41,716 |
) |
Mixed-use development |
|
|
9,153 |
|
|
|
9,933 |
|
Corporate and other |
|
|
(4,705 |
) |
|
|
(1,971 |
) |
SCHEDULE 2: Cash and Debt
The following presentation is provided to separately identify cash and debt information. ABH cash increased
(amounts in thousands) |
|
December 31, 2023 |
|
March 31, 2024 |
||||
ABH Cash (GAAP)(a) |
|
$ |
125,148 |
|
|
$ |
181,461 |
|
|
|
|
|
|
||||
Debt: |
|
|
|
|
|
|
||
Baseball |
|
|
|
|
|
|
||
League wide credit facility |
|
$ |
— |
|
|
$ |
— |
|
MLB facility fund - term |
|
|
30,000 |
|
|
|
30,000 |
|
MLB facility fund - revolver |
|
|
41,400 |
|
|
|
40,825 |
|
TeamCo revolver |
|
|
— |
|
|
|
— |
|
Term debt |
|
|
165,370 |
|
|
|
162,119 |
|
Mixed-use development |
|
|
336,177 |
|
|
|
350,428 |
|
Total ABH Debt |
|
$ |
572,947 |
|
|
$ |
583,372 |
|
Deferred financing costs |
|
|
(3,678 |
) |
|
|
(3,459 |
) |
Total ABH Debt (GAAP) |
|
$ |
569,269 |
|
|
$ |
579,913 |
|
| _______________ | ||
a) |
Excludes restricted cash held in reserves pursuant to the terms of various financial obligations of |
|
CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION March 31, 2024 (unaudited) |
|||||||
|
|
|
|
|
|||
|
|
March 31, |
|
December 31, |
|||
|
|
2024 |
|
2023 |
|||
|
|
amounts in thousands, |
|||||
|
|
except share amounts |
|||||
Assets |
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
181,461 |
|
|
125,148 |
|
Restricted cash |
|
|
27,556 |
|
|
12,569 |
|
Accounts receivable and contract assets, net of allowance for credit losses of |
|
|
40,242 |
|
|
62,922 |
|
Other current assets |
|
|
38,182 |
|
|
17,380 |
|
Total current assets |
|
|
287,441 |
|
|
218,019 |
|
|
|
|
|
|
|
||
Property and equipment, at cost |
|
|
1,126,995 |
|
|
1,091,943 |
|
Accumulated depreciation |
|
|
(338,745 |
) |
|
(325,196 |
) |
|
|
|
788,250 |
|
|
766,747 |
|
|
|
|
|
|
|
||
Investments in affiliates, accounted for using the equity method |
|
|
100,140 |
|
|
99,213 |
|
Intangible assets not subject to amortization: |
|
|
|
|
|
||
Goodwill |
|
|
175,764 |
|
|
175,764 |
|
Franchise rights |
|
|
123,703 |
|
|
123,703 |
|
|
|
|
299,467 |
|
|
299,467 |
|
|
|
|
|
|
|
||
Other assets, net |
|
|
126,891 |
|
|
120,884 |
|
Total assets |
|
$ |
1,602,189 |
|
|
1,504,330 |
|
|
|
|
|
|
|
||
Liabilities and Equity |
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
||
Accounts payable and accrued liabilities |
|
$ |
99,118 |
|
|
73,096 |
|
Deferred revenue and refundable tickets |
|
|
212,367 |
|
|
111,985 |
|
Current portion of debt |
|
|
42,547 |
|
|
42,153 |
|
Other current liabilities |
|
|
5,839 |
|
|
6,439 |
|
Total current liabilities |
|
|
359,871 |
|
|
233,673 |
|
|
|
|
|
|
|
||
Long-term debt |
|
|
537,366 |
|
|
527,116 |
|
Finance lease liabilities |
|
|
105,844 |
|
|
103,586 |
|
Deferred income tax liabilities |
|
|
57,162 |
|
|
50,415 |
|
Pension liability |
|
|
13,042 |
|
|
15,222 |
|
Other noncurrent liabilities |
|
|
37,657 |
|
|
33,676 |
|
Total liabilities |
|
|
1,110,942 |
|
|
963,688 |
|
Equity: |
|
|
|
|
|
||
Preferred stock, |
|
|
— |
|
|
— |
|
Series A common stock, |
|
|
103 |
|
|
103 |
|
Series B common stock, |
|
|
10 |
|
|
10 |
|
Series C common stock, |
|
|
506 |
|
|
506 |
|
Additional paid-in capital |
|
|
1,091,572 |
|
|
1,089,625 |
|
Accumulated other comprehensive earnings (loss), net of taxes |
|
|
(7,341 |
) |
|
(7,271 |
) |
Retained earnings (deficit) |
|
|
(605,648 |
) |
|
(554,376 |
) |
Total stockholders' equity |
|
|
479,202 |
|
|
528,597 |
|
Noncontrolling interests in equity of subsidiaries |
|
|
12,045 |
|
|
12,045 |
|
Total equity |
|
|
491,247 |
|
|
540,642 |
|
Commitments and contingencies |
|
|
|
|
|
||
Total liabilities and equity |
|
$ |
1,602,189 |
|
|
1,504,330 |
|
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS INFORMATION March 31, 2024 (unaudited) |
|||||||
|
|
|
|
|
|||
|
|
Three months ended |
|||||
|
|
March 31, |
|||||
|
|
2024 |
|
2023 |
|||
|
|
amounts in thousands, |
|||||
|
|
except per share amounts |
|||||
Revenue: |
|
|
|
|
|
||
Baseball revenue |
|
$ |
21,970 |
|
|
17,561 |
|
Mixed-use development revenue |
|
|
15,110 |
|
|
13,411 |
|
Total revenue |
|
|
37,080 |
|
|
30,972 |
|
Operating costs and expenses: |
|
|
|
|
|
||
Baseball operating costs |
|
|
45,207 |
|
|
36,771 |
|
Mixed-use development costs |
|
|
2,253 |
|
|
1,931 |
|
Selling, general and administrative, including stock-based compensation |
|
|
27,093 |
|
|
26,848 |
|
Depreciation and amortization |
|
|
14,882 |
|
|
14,679 |
|
|
|
|
89,435 |
|
|
80,229 |
|
Operating income (loss) |
|
|
(52,355 |
) |
|
(49,257 |
) |
Other income (expense): |
|
|
|
|
|
||
Interest expense |
|
|
(9,443 |
) |
|
(8,912 |
) |
Share of earnings (losses) of affiliates, net |
|
|
1,627 |
|
|
(803 |
) |
Realized and unrealized gains (losses) on intergroup interests, net |
|
|
— |
|
|
(13,377 |
) |
Realized and unrealized gains (losses) on financial instruments, net |
|
|
2,974 |
|
|
(761 |
) |
Other, net |
|
|
1,769 |
|
|
841 |
|
Earnings (loss) before income taxes |
|
|
(55,428 |
) |
|
(72,269 |
) |
Income tax benefit (expense) |
|
|
4,156 |
|
|
14,293 |
|
Net earnings (loss) |
|
$ |
(51,272 |
) |
|
(57,976 |
) |
Basic net earnings (loss) attributable to Series A, Series B and Series C Atlanta Braves Holdings, Inc. shareholders per common share |
|
$ |
(0.83 |
) |
|
(0.94 |
) |
Diluted net earnings (loss) attributable to Series A, Series B and Series C Atlanta Braves Holdings, Inc. shareholders per common share |
|
$ |
(0.83 |
) |
|
(0.94 |
) |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS INFORMATION March 31, 2024 (unaudited) |
|||||||
|
|
|
|
|
|||
|
|
Three months ended |
|||||
|
|
March 31, |
|||||
|
|
2024 |
|
2023 |
|||
|
|
amounts in thousands |
|||||
Cash flows from operating activities: |
|
|
|
|
|
||
Net earnings (loss) |
|
$ |
(51,272 |
) |
|
(57,976 |
) |
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities: |
|
|
|
|
|
||
Depreciation and amortization |
|
|
14,882 |
|
|
14,679 |
|
Stock-based compensation |
|
|
3,719 |
|
|
3,191 |
|
Share of (earnings) losses of affiliates, net |
|
|
(1,627 |
) |
|
803 |
|
Realized and unrealized (gains) losses on intergroup interests, net |
|
|
— |
|
|
13,377 |
|
Realized and unrealized (gains) losses on financial instruments, net |
|
|
(2,974 |
) |
|
761 |
|
Deferred income tax expense (benefit) |
|
|
6,772 |
|
|
(7,715 |
) |
Cash receipts from returns on equity method investments |
|
|
700 |
|
|
200 |
|
Net cash received (paid) for interest rate swaps |
|
|
1,511 |
|
|
1,222 |
|
Other charges (credits), net |
|
|
(542 |
) |
|
318 |
|
Net change in operating assets and liabilities: |
|
|
|
|
|
||
Current and other assets |
|
|
11,191 |
|
|
20,350 |
|
Payables and other liabilities |
|
|
108,704 |
|
|
95,355 |
|
Net cash provided by (used in) operating activities |
|
|
91,064 |
|
|
84,565 |
|
Cash flows from investing activities: |
|
|
|
|
|
||
Capital expended for property and equipment |
|
|
(27,642 |
) |
|
(13,647 |
) |
Other investing activities, net |
|
|
47 |
|
|
110 |
|
Net cash provided by (used in) investing activities |
|
|
(27,595 |
) |
|
(13,537 |
) |
Cash flows from financing activities: |
|
|
|
|
|
||
Borrowings of debt |
|
|
13,789 |
|
|
— |
|
Repayments of debt |
|
|
(4,018 |
) |
|
(3,893 |
) |
Contribution from noncontrolling interest |
|
|
— |
|
|
6,645 |
|
Other financing activities, net |
|
|
(1,940 |
) |
|
(1,050 |
) |
Net cash provided by (used in) financing activities |
|
|
7,831 |
|
|
1,702 |
|
Net increase (decrease) in cash, cash equivalents and restricted cash |
|
|
71,300 |
|
|
72,730 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
137,717 |
|
|
172,813 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
209,017 |
|
|
245,543 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507254217/en/
Shane Kleinstein (720) 875-5432
Source: Atlanta Braves Holdings, Inc.
FAQ
What was the total revenue for Atlanta Braves Holdings in the first quarter of 2024?
How much did baseball revenue grow by in the first quarter of 2024?
What was the Adjusted OIBDA for the mixed-use development segment in the first quarter of 2024?
Why did the operating loss increase in the first quarter of 2024?
