Atlanta Braves Holdings, Inc. (“Atlanta Braves Holdings”)
(Nasdaq: BATRA, BATRK) today reported third quarter 2023
results.
Headlines include(1):
- Total revenue grew 11% to $272 million in third quarter
- Baseball revenue up 11% to $256 million
- Mixed-use development revenue up 10% to $16 million
- Mixed-use development generated $11 million of Adjusted
OIBDA(2) in third quarter
- Atlanta Braves secured sixth consecutive NL East Title
- 54 game sellouts and 3.2 million tickets sold for 2023
season
Corporate Updates
On July 18, 2023, Liberty Media Corporation (“Liberty Media”)
completed the split-off of the Braves and its associated mixed-use
development (the “Split-Off”) into the separate public company
Atlanta Braves Holdings. The businesses and assets at Atlanta
Braves Holdings consist of Braves Holdings, LLC, the owner and
operator of the Atlanta Braves Major League Baseball Club, and
certain assets and liabilities associated with the Braves’ ballpark
and mixed-use development, called The Battery Atlanta, which were
previously attributed to the Braves Group tracking stock of Liberty
Media. For purposes of this presentation, Atlanta Braves Holdings
standalone results, assets and liabilities represent the
combination of the historical financial information of the Braves
Group until the date of the Split-Off. Although Atlanta Braves
Holdings was reported as a combined company until the date of the
Split-Off, it is now a consolidated company and all periods
reported in this presentation are referred to as consolidated.
Discussion of
Results
Three months ended
Nine months ended
September 30,
September 30,
2022
2023
% Change
2022
2023
% Change
amounts in thousands
amounts in thousands
Baseball revenue
$
231,279
$
256,266
11
%
$
478,037
$
528,762
11
%
Mixed-use development revenue
14,168
15,558
10
%
39,265
44,157
12
%
Total revenue
245,447
271,824
11
%
517,302
572,919
11
%
Operating costs and expenses:
Baseball operating costs
(194,216
)
(198,195
)
(2
)
%
(390,027
)
(430,424
)
(10
)
%
Mixed-use development costs
(2,089
)
(2,247
)
(8
)
%
(6,399
)
(6,451
)
(1
)
%
Selling, general and administrative,
excluding stock-based compensation
(24,626
)
(31,037
)
(26
)
%
(73,519
)
(84,686
)
(15
)
%
Adjusted OIBDA
$
24,516
$
40,345
65
%
$
47,357
$
51,358
8
%
Operating income (loss)
$
(4,692
)
$
15,716
NM
$
(23,371
)
$
(14,074
)
40
%
Regular season home games in period
38
37
79
80
Unless otherwise noted, the following discussion compares
financial information for the three months ended September 30, 2023
to the same period in 2022.
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
Nine months ended
September 30,
September 30,
2022
2023
% Change
2022
2023
% Change
amounts in thousands
amounts in thousands
Baseball:
Baseball event
$
134,941
$
160,794
19
%
$
281,144
$
324,280
15
%
Broadcasting
66,901
69,337
4
%
130,646
138,786
6
%
Retail and licensing
17,590
20,904
19
%
39,200
45,026
15
%
Other
11,847
5,231
(56
)
%
27,047
20,670
(24
)
%
Baseball revenue
231,279
256,266
11
%
478,037
528,762
11
%
Mixed-use development
14,168
15,558
10
%
39,265
44,157
12
%
Total revenue
$
245,447
$
271,824
11
%
$
517,302
$
572,919
11
%
There were 37 regular season home games played in the third
quarter of 2023 compared to 38 regular season home games in the
prior year period.
Baseball revenue increased 11% in the third quarter. Baseball
event and retail and licensing revenue grew primarily due to
increased ticket demand and attendance at regular season home
games. Broadcasting revenue increased due to contractual rate
increases. Other revenue declined due to fewer concerts at the
ballpark compared to the prior year period. Mixed-use development
revenue increased 10% during the third quarter due to increases in
rental income related to tenant recoveries and various new lease
agreements, as well as higher sponsorship revenue.
Operating income and Adjusted OIBDA increased in the third
quarter. Revenue growth more than offset increased baseball
operating costs due to higher player salaries and minor league team
and player expenses. Selling, general and administrative expense
increased during the third quarter primarily driven by costs
related to the Split-Off.
FOOTNOTES
1)
Atlanta Braves Holdings will be available
to answer questions related to these headlines and other matters on
Liberty Media Corporation’s earnings conference call that will
begin at 10:00 a.m. (E.T.) on November 3, 2023. For information
regarding how to access the call, please see “Important Notice”
later in this document.
2)
For a definition of Adjusted OIBDA (as
defined by Atlanta Braves Holdings) and the applicable
reconciliation, see the accompanying schedule.
Important Notice: Atlanta Braves Holdings (Nasdaq: BATRA,
BATRK) will be available to answer questions on Liberty Media
Corporation’s third quarter earnings conference call which will
begin at 10:00 a.m. (E. T.) on November 3, 2023. The call can be
accessed by dialing (877) 704-2829 or (215) 268-9864, passcode
13736986 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 Atlanta
Braves Holdings 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, Atlanta Braves Holdings’ ability to recognize
anticipated benefits from the split-off, possible changes in the
regulatory and competitive environment in which Atlanta Braves
Holdings operates (including an expansion of MLB), the unfavorable
outcome of pending or future litigation, operational risks of
Atlanta Braves Holdings and its business affiliates, including
operations outside of the U.S., Atlanta Braves Holdings’
indebtedness and its ability to obtain additional financing on
acceptable terms and cash in amounts sufficient to service debt and
other financial obligations, tax matters, compliance with
government regulations and potential adverse outcomes of regulatory
proceedings, changes in the nature of key strategic relationships
with broadcasters, partners, vendors and joint venturers, the
impact of organized labor, the performance and management of the
mixed-use development and the impact of inflation and weak economic
conditions on consumer demand. These forward-looking statements
speak only as of the date of this press release, and Atlanta Braves
Holdings expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking
statement contained herein to reflect any change in Atlanta Braves
Holdings’ expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.
Please refer to the publicly filed documents of Atlanta Braves
Holdings, including Amendment No. 5 to the Registration Statement
on Form S-4 filed by Atlanta Braves Holdings with the Securities
and Exchange Commission on June 8, 2023, the Registration Statement
on Form S-1 filed by Atlanta Braves Holdings with the Securities
and Exchange Commission on September 8, 2023, and the most recent
Form 10-Q, for additional information about Atlanta Braves Holdings
and about the risks and uncertainties related to Atlanta Braves
Holdings’ business which may affect the statements made in this
press release.
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 Atlanta
Braves Holdings together with reconciliations to operating income,
as determined under GAAP. Atlanta Braves Holdings defines Adjusted
OIBDA as operating income (loss) plus depreciation and
amortization, stock-based compensation, separately reported
litigation settlements, restructuring, acquisition and impairment
charges.
Atlanta Braves Holdings 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, Atlanta Braves Holdings 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 Atlanta Braves
Holdings’ management considers in assessing the results of
operations and performance of its assets.
The following table provides a reconciliation of Adjusted OIBDA
for Atlanta Braves Holdings to operating income (loss) calculated
in accordance with GAAP for the three and nine months ended
September 30, 2022 and September 30, 2023.
Three months ended
Nine months ended
September 30,
September 30,
(amounts in thousands)
2022
2023
2022
2023
Operating income (loss)
$
(4,692
)
$
15,716
$
(23,371
)
$
(14,074
)
Impairment of long-lived assets and other
related costs
4,811
34
4,811
564
Stock-based compensation
3,062
3,309
9,188
9,653
Depreciation and amortization
21,335
21,286
56,729
55,215
Adjusted OIBDA
$
24,516
$
40,345
$
47,357
$
51,358
Baseball
$
18,072
$
36,918
$
28,653
$
38,796
Mixed-use development
9,696
10,661
26,093
29,980
Corporate and other
(3,252
)
(7,234
)
(7,389
)
(17,418
)
SCHEDULE 2: Cash and Debt
The following presentation is provided to separately identify
cash and debt information. Atlanta Braves Holdings cash decreased
$24 million during the third quarter due to cash used in operations
primarily due to seasonal working capital changes, as well as
capital expenditures, partially offset by the release of restricted
cash pursuant to the terms of various financial debt arrangements
and net borrowing. Atlanta Braves Holdings debt increased $16
million in the third quarter primarily due to borrowings under the
TeamCo revolver and mixed-use development credit facilities.
(amounts in thousands)
June 30, 2023
September 30, 2023
Atlanta Braves Holdings Cash
(GAAP)(a)
$
130,537
$
106,715
Debt:
Baseball
League wide credit facility
$
—
$
—
MLB facility fund - term
30,000
30,000
MLB facility fund - revolver
43,125
41,400
TeamCo revolver
—
10,000
Term debt
168,561
165,370
Mixed-use development
301,127
312,399
Total Atlanta Braves Holdings
Debt
$
542,813
$
559,169
Deferred financing costs
(4,118
)
(3,898
)
Total Atlanta Braves Holdings Debt
(GAAP)
$
538,695
$
555,271
___________________
a)
Excludes restricted cash held in reserves
pursuant to the terms of various financial obligations of $52
million and $20 million as of June 30, 2023 and September 30, 2023,
respectively.
ATLANTA BRAVES
HOLDINGS
CONDENSED CONSOLIDATED BALANCE
SHEET INFORMATION
September 30, 2023
(unaudited)
September 30,
December 31,
2023
2022
amounts in thousands
except share amounts
Assets
Current assets:
Cash and cash equivalents
$
106,715
150,664
Restricted cash
19,814
22,149
Accounts receivable and contract assets,
net of allowance for credit losses
99,095
70,234
Other current assets
18,224
24,331
Total current assets
243,848
267,378
Property and equipment, at cost
1,061,776
1,007,776
Accumulated depreciation
(312,286
)
(277,979
)
749,490
729,797
Investments in affiliates, accounted for
using the equity method
105,614
94,564
Intangible assets not subject to
amortization:
Goodwill
175,764
175,764
Franchise rights
123,703
123,703
299,467
299,467
Other assets, net
120,420
99,455
Total assets
$
1,518,839
1,490,661
Liabilities and Equity
Current liabilities:
Accounts payable and accrued
liabilities
$
68,339
54,748
Deferred revenue and refundable
tickets
106,120
104,996
Current portion of debt
7,786
74,806
Other current liabilities
7,056
6,361
Total current liabilities
189,301
240,911
Long-term debt
547,485
467,160
Redeemable intergroup interests
—
278,103
Finance lease liabilities
106,751
107,220
Deferred income tax liabilities
56,682
54,099
Pension liability
10,712
15,405
Other noncurrent liabilities
32,257
28,253
Total liabilities
943,188
1,191,151
Equity:
Preferred stock, $.01 par value.
Authorized 50,000,000 shares; zero shares issued at September 30,
2023 and December 31, 2022
—
—
Series A common stock, $.01 par value.
Authorized 200,000,000 shares; issued and outstanding 10,318,202
and zero at September 30, 2023 and December 31, 2022,
respectively
103
—
Series B common stock, $.01 par value.
Authorized 7,500,000 shares; issued and outstanding 977,795 and
zero at September 30, 2023 and December 31, 2022, respectively
10
—
Series C common stock, $.01 par value.
Authorized 200,000,000 shares; issued and outstanding 50,427,249
and zero at September 30, 2023 and December 31, 2022,
respectively
504
—
Additional paid-in capital
1,088,517
—
Former parent’s investment
—
732,350
Accumulated other comprehensive earnings
(loss), net of taxes
(3,510
)
(3,758
)
Retained earnings (deficit)
(522,018
)
(429,082
)
Total stockholders' equity/former parent's
investment
563,606
299,510
Noncontrolling interests in equity of
subsidiaries
12,045
—
Total equity
575,651
299,510
Commitments and contingencies
Total liabilities and equity
$
1,518,839
1,490,661
ATLANTA BRAVES
HOLDINGS
CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS INFORMATION
September 30, 2023
(unaudited)
Three months ended
Nine months ended
September 30,
September 30,
2023
2022
2023
2022
amounts in thousands, except
per share amounts
Revenue:
Baseball revenue
$
256,266
231,279
$
528,762
478,037
Mixed-use development revenue
15,558
14,168
44,157
39,265
Total revenue
271,824
245,447
572,919
517,302
Operating costs and expenses:
Baseball operating costs
198,195
194,216
430,424
390,027
Mixed-use development costs
2,247
2,089
6,451
6,399
Selling, general and administrative,
including stock-based compensation
34,346
27,688
94,339
82,707
Impairment of long-lived assets and other
related costs
34
4,811
564
4,811
Depreciation and amortization
21,286
21,335
55,215
56,729
256,108
250,139
586,993
540,673
Operating income (loss)
15,716
(4,692)
(14,074)
(23,371)
Other income (expense):
Interest expense
(9,657)
(7,999)
(28,017)
(20,528)
Share of earnings (losses) of affiliates,
net
12,725
9,975
23,384
22,118
Realized and unrealized gains (losses) on
intergroup interests, net
(20,392)
(30,940)
(83,178)
5,163
Realized and unrealized gains (losses) on
financial instruments, net
2,593
5,778
5,672
12,238
Gains (losses) on dispositions, net
15
68
2,518
20,283
Other, net
1,209
161
2,863
329
Earnings (loss) before income taxes
2,209
(27,649)
(90,832)
16,232
Income tax benefit (expense)
(8,256)
(2,248)
(2,104)
(5,465)
Net earnings (loss)
$
(6,047)
(29,897)
$
(92,936)
10,767
Basic net earnings (loss) attributable to
Series A, Series B and Series C Atlanta Braves Holdings, Inc.
shareholders per common share
$
(0.10)
(0.48)
$
(1.51)
0.17
Diluted net earnings (loss) attributable
to Series A, Series B and Series C Atlanta Braves Holdings, Inc.
shareholders per common share
$
(0.10)
(0.48)
$
(1.51)
0.17
ATLANTA BRAVES
HOLDINGS
CONDENSED CONSOLIDATED
STATEMENT OF CASH FLOWS INFORMATION
September 30, 2023
(unaudited)
Nine months ended
September 30,
2023
2022
amounts in thousands
Cash flows from operating activities:
Net earnings (loss)
$
(92,936)
10,767
Adjustments to reconcile net earnings
(loss) to net cash provided by (used in) operating activities:
Depreciation and amortization
55,215
56,729
Stock-based compensation
9,653
9,188
Impairment of long-lived assets
—
4,811
Share of (earnings) losses of affiliates,
net
(23,384)
(22,118)
Realized and unrealized (gains) losses on
intergroup interests, net
83,178
(5,163)
Realized and unrealized (gains) losses on
financial instruments, net
(5,672)
(12,238)
(Gains) losses on dispositions, net
(2,518)
(20,283)
Deferred income tax expense (benefit)
(6,086)
(2,111)
Cash receipts from returns on equity
method investments
12,350
14,850
Other charges (credits), net
4,856
2,041
Net change in operating assets and
liabilities:
Current and other assets
(67,475)
(22,628)
Payables and other liabilities
11,513
5,543
Net cash provided by (used in) operating
activities
(21,306)
19,388
Cash flows from investing activities:
Capital expended for property and
equipment
(45,313)
(13,174)
Cash proceeds from dispositions
—
47,840
Investments in equity method affiliates
and equity securities
(125)
(5,273)
Other investing activities, net
110
—
Net cash provided by (used in) investing
activities
(45,328)
29,393
Cash flows from financing activities:
Borrowings of debt
52,248
134,753
Repayments of debt
(38,997)
(235,368)
Payments to settle intergroup
interests
—
(13,828)
Contribution from noncontrolling
interest
12,045
—
Other financing activities, net
(4,946)
(5,135)
Net cash provided by (used in) financing
activities
20,350
(119,578)
Net increase (decrease) in cash, cash
equivalents and restricted cash
(46,284)
(70,797)
Cash, cash equivalents and restricted cash
at beginning of period
172,813
244,113
Cash, cash equivalents and restricted cash
at end of period
$
126,529
173,316
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231102958609/en/
Shane Kleinstein (720) 875-5432
Atlanta Braves (NASDAQ:BATRK)
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