The following is a description of the adjustments to operating loss in arriving at adjusted operating loss as described in this earnings release:
-- Share-based compensation. This adjustment eliminates the compensation
expense relating to restricted stock units, performance stock units and
stock options granted under the Sphere Entertainment Employee Stock Plan,
MSG Sports Employee Stock Plan, MSG Networks Employee Stock Plan, as
amended and assumed by Sphere Entertainment, and Sphere Entertainment
Non-Employee Director Plan.
-- Depreciation and amortization. This adjustment eliminates depreciation
and amortization of property and equipment and intangible assets in all
periods.
-- Restructuring charges. This adjustment eliminates costs related to
termination benefits provided to certain executives and employees.
-- Impairment and other losses (gains), net. This adjustment eliminates
non-cash impairment charges and the impact of gains or losses from the
disposition of assets or businesses in all periods.
-- Merger, debt work-out, and acquisition related costs. This adjustment
eliminates costs related to mergers, debt work-outs and acquisitions,
including merger-related litigation expenses and litigation-related
insurance recoveries, in all periods.
-- Amortization for capitalized cloud computing arrangement costs. This
adjustment eliminates amortization of capitalized cloud computing
arrangement costs.
-- Remeasurement of deferred compensation plan liabilities. This adjustment
eliminates the impact of gains and losses related to the remeasurement of
liabilities under the Company's executive deferred compensation plan.
Three Months Ended
September 30,
--------------------------------
2024 2023
--------------- ---------------
Operating loss $ (117,619) $ (69,789)
Share-based compensation 15,567 4,883
Depreciation and amortization 81,913 14,259
Restructuring charges 913 3,391
Impairment and other losses (gains), net 4,033 (1,497)
Merger, debt work-out, and acquisition
related costs, net of insurance
recoveries 4,820 (9,043)
Amortization for capitalized cloud
computing arrangement costs 22 22
Loss (gain) on remeasurement of deferred
compensation plan liabilities 157 (107)
--------------- ---------------
Adjusted operating loss $ (10,194) $ (57,881)
=============== ===============
SPHERE ENTERTAINMENT CO.
SEGMENT RESULTS
(In thousands)
(Unaudited)
BUSINESS SEGMENT RESULTS
Three Months Ended September 30, 2024
MSG
Sphere Networks Total
--------------------- ----------------------- ---------------------
Revenues $ 127,072 $ 100,841 $ 227,913
Direct operating
expenses (62,449) (77,247) (139,696)
Selling, general
and
administrative
expenses (104,950) (14,027) (118,977)
Depreciation and
amortization (79,838) (2,075) (81,913)
Impairment and
other losses,
net (4,033) -- (4,033)
Restructuring
charges (883) (30) (913)
--------------------- ----------------------- ---------------------
Operating (loss)
income $ (125,081) $ 7,462 $ (117,619)
Reconciliation
to adjusted
operating (loss)
income:
Share-based
compensation 13,180 2,387 15,567
Depreciation
and
amortization 79,838 2,075 81,913
Restructuring
charges 883 30 913
Impairment and
other losses,
net 4,033 -- 4,033
Merger, debt
work-out, and
acquisition
related costs,
net of
insurance
recoveries 692 4,128 4,820
Amortization
for
capitalized
cloud
computing
arrangement
costs -- 22 22
Loss on
remeasurement
of deferred
compensation
plan
liabilities 157 -- 157
--------------------- ----------------------- ---------------------
Adjusted
operating (loss)
income $ (26,298) $ 16,104 $ (10,194)
===================== ======================= =====================
Three Months Ended September 30, 2023
MSG
Sphere Networks Total
--------------------- ----------------------- ---------------------
Revenues $ 7,779 $ 110,228 $ 118,007
Direct operating
expenses (7,805) (76,694) (84,499)
Selling, general
and
administrative
expenses (84,150) (2,994) (87,144)
Depreciation and
amortization (12,377) (1,882) (14,259)
Other gains, net 1,497 -- 1,497
Restructuring
charges (3,391) -- (3,391)
--------------------- ----------------------- ---------------------
Operating (loss)
income $ (98,447) $ 28,658 $ (69,789)
Reconciliation
to adjusted
operating (loss)
income:
Share-based
compensation 3,919 964 4,883
Depreciation
and
amortization 12,377 1,882 14,259
Restructuring
charges 3,391 -- 3,391
Other gains,
net (1,497) -- (1,497)
Merger, debt
work-out, and
acquisition
related costs,
net of
insurance
recoveries (2,702) (6,341) (9,043)
Amortization
for
capitalized
cloud
computing
arrangement
costs -- 22 22
Gain on
remeasurement
of deferred
compensation
plan
liabilities $ (107) $ -- $ (107)
--------------------- ----------------------- ---------------------
Adjusted
operating (loss)
income $ (83,066) $ 25,185 $ (57,881)
===================== ======================= =====================
SPHERE ENTERTAINMENT CO.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
September 30, June 30,
---------------- ----------------
2024 2024
ASSETS
Current Assets:
Cash, cash equivalents, and
restricted cash $ 553,217 $ 573,233
Accounts receivable, net 114,645 228,230
Related party receivables, current 12,102 9,377
Prepaid expenses and other current
assets 56,087 54,855
Total current assets 736,051 865,695
Non-Current Assets:
Investments 31,395 30,728
Property and equipment, net 3,092,449 3,158,420
Right-of-use lease assets 103,227 106,468
Goodwill 470,152 470,152
Intangible assets, net 30,141 31,940
Other non-current assets 129,254 124,489
Total assets $ 4,592,669 $ 4,787,892
================ ================
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable, accrued and other
current liabilities $ 371,877 $ 417,087
(MORE TO FOLLOW) Dow Jones Newswires
November 12, 2024 07:30 ET (12:30 GMT)
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