Q4 2020 Liberty Media Corp Earnings Call

[music].

Ladies and gentlemen, thank you for standing by.

Welcome to the Liberty Media Corporation 2020 year end earnings call.

During the presentation, all participants will be in a listen only mode.

Afterwards, we will conduct a question and answer session at that time. If you have a question. Please press star one on your telephone keypad.

As a reminder, this conference is being recorded today February 26.

I would now like to turn the conference over to Courtney Chun Chief portfolio Officer. Please go ahead.

Thank you good morning, before we begin we'd like to remind everyone. On this call includes certain forward looking statements within the meaning of the private Securities Litigation Reform Act on 1995 actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in Liberty media on the most recent form 10-K on Liberty media acquisition for them.

S. One registration statement filed with the SEC. These forward might be even speak only as of the date on this call and Liberty media and Liberty media acquisition expressly disclaims any obligation or undertaking.

Any updates or revisions to any forward looking statements.

And here in terms of like any change in the media on Liberty Media acquisition Corp, expectations with regard thereto or any change in events conditions or circumstances on which any such statement is based on.

On today's call, we will discuss certain non-GAAP financial measures from Liberty media and Siriusxm.

Adjusted OIBDA and adjusted EBITDA, the required definitions and reconciliations from Liberty media and Sirius XM schedules, one and two can be found at the end of the earnings press release issued today, which is available on.

Now I'd like to turn the call over to Greg, Let's say in Liberty's President and CEO. Thank you Courtney and good morning to all of you are.

Today speaking on the call. We'll also have formula one's new President and CEO Stefano Domenicali.

Liberty, Chief Accounting Officer, and principal financial Officer, Brian Wendling.

I'd once again like to recognize and thank our management team and employees for the tremendous job they've done mainly from COVID-19 in difficult circumstances.

Beginning with Liberty Liberty, Sirius XM and I know, we continued our share repurchase as repurchasing $99 million across all aspects of NK chairs in the November to January time frame.

As you know the discount persists and we repurchased at a look through price on CRE of about $3 70 per share.

We do expect to continue to take advantage of the discount opportunity in part driven by some recent balance sheet improvements we have at L S etc.

In November we raised $929 million a day live exchangeable bond at 50 bps to repairing or.

<unk> exchange that were maturing later this year and from the call spread.

Between the Olympics I mean, one that originated when we did the reattribution.

In tandem we amended amended the live margin loan and unencumbered a substantial portion of our lives equity.

Also after quarter end, we amended our siri margin loan increasing our borrowing capacity from $1 35 billion to $1 75 billion.

Accordingly, we have generated substantial incremental borrowing capacity to go after that discount and we continue to take advantage of it.

Our ownership of series six as.

As of January 29 stood at 76, 4%.

We do expect to get to 80% ownership in this year and we recently announced a tax sharing agreement between Sirius XM and Liberty Sirius XM.

The Siri Board of directors evaluate your capital return strategy every quarter and we'll continue to do so if liberty gets to the 80% ownership level as we expect later this year.

So let me get serious itself, we welcome Jennifer Witz, who will assume her new CEO role in January.

The new car penetration at Siri had 80 per cent in the fourth quarter and we have line of sight to get to 82% in 2021.

Sirius XM hardware Who's now one out of every two cars on the road and the number continues to climb.

Ethics himself paint households, listening on the digital environment I eat out of the car grew 40% in 2020.

And stitcher has the largest share of U S podcast listening audience available to advertisers.

We do make sure you listened to the podcast of the year Office Lady.

Don't do that you have been to our Investor day as you know how much we loved the office.

Turning to live nation, we continue to have great demand for concerts, perhaps notably the weekend sold over 1 million tickets worldwide for its 2022 tour just one week after announcing mature clearly there is robust demand as we noted for live music.

<unk> also acquired a majority stake in beats a ticketing livestream platform I encourage you to check out the series they have on Rufus Wainwright.

Terminate on turning to the Formula One group.

As I mentioned, we have a new CEO there on Stefano.

Stefano Timna colleagues from whom you will hear in a minute.

We are planning for a record 23 races. This year.

Notably the Orange Army is ready to welcome the Dutch G P and local hero Max per stop it in September a dashboard.

2020 showed we have ample demand for OCC races, even on short notice from both new and historic tracks.

And not from any of you haven't seen everything you want to see streamed online this year and get ready to tune in for season three of drive to survive, which drops on Netflix on March 19th.

In January we introduced Almac this back.

We raised $575 million, that's the largest corporates back to date.

According to banks, who are involved from maybe they're biased because most oversubscribed stack of all time in the first trade at 13 20 was the highest initial trade for earnings back to date.

<unk> has continued to trade well, but admittedly on print volume.

We are actively in discussions with a number of targets in the TMT space.

The 20% interest in <unk>.

Is attributed to the Formula One group.

And I would remind you that the formula One group has committed.

Two Ford purchased $250 million at $10 per year.

In connection with the initial business combination when it occurs.

Turning to Braves.

We sadly lost some icons of the brands in this off season.

And we'd like to start by paying tribute to them, notably fill Negro and of course.

Yeah.

We started a fund named after Hank guaranteed it with $1 million from the brains plus $1 million from.

Major League baseball and the Major League Baseball players Association to help grow diversity in baseball.

We are excited about our enhanced 2021, Ross, we're coming off of winning.

At least for our third straight season.

We did resign Marcellus to a four year deal.

As you May recall, we came within one year, one win rather from going to last year's World series. So our guidance are ready to go ready frame and coming off of 2020, NFL MVP Kuhnian lbs, and more are hungry and ready.

Spring training did start.

Recently on Tuesday, and our core strength spring training game is this Sunday, we expect fans to be attendance at 25% capacity.

Turning back to the home from the three ballpark office tower.

Near completion at 70% leased.

Both kitchen, Cook and Papa John's will fully occupy their space by the summer of 2021.

97% of the batteries tenants are operational which speaks to the relative openness of Georgia.

And we believe bodes well for fans and true it this year.

We do expect to have fans in advance, but we're not yet sure of the seating capacity restrictions.

And we do have significant demand for both tickets.

A true it and spring training.

As I noted, we look forward to a great 2021 season, and including hosting the MLB All star game on July 13th.

So with that let me turn it over to Brian for some more financial results.

Thanks, Greg and good morning, everyone.

Liberty Sirius XM group, we've taken a number of steps to boost liquidity and strengthen the balance sheet.

The fourth quarter, we issued $920 million of broad nation, exchangeable bonds and amended our one nation margin on unencumbered substantial live nation equity value Amendment.

Increasing the shares underlying the loans from $53 7 million to $9 million.

Subsequent to quarter end, we amended our siri margin loan increasing borrowing capacity to $1 75 billion up from 135 billion at year end and borrowing an additional $125 million.

Inclusive of this additional margin loan draw on Liberty Siriusxm group had attributed cash restricted cash and liquid investments of $1 1 billion.

Splitting $83 million of cash and restricted cash held directly at Sirius XM.

We also have $1 1 billion of Undrawn margin on capacity at the parent level.

Note that approximately $850 million of our cash will be used in 2021 to settle the call spread between the Formula One group and Liberty Sirius XM group and to repay our $2 two 5% live nation exchangeable bonds.

This value is based on estimates of the fair value or from the fair value book liabilities at year end.

That is on February 25th the value of the Siriusxm stock held at Liberty Sirius XM group was $19 billion and the value of our live nation stock was $6 billion, excluding valuable audition call spread held at Formula one.

Value to 370 $471 million a year round.

We have $3 2 billion in principal amount of debt against these holdings total Liberty Siriusxm group attributed principal amount of debt was $12 8 billion, which includes $8 6 billion of debt.

Sirius XM directly.

Formula One group had attributed cash and liquid investments of $1 4 billion, which excludes $265 million of cash held at Formula one.

The total in total Formula One group attributed principal amount of debt was $3 6 billion, which includes $2 9 billion with debt.

On the new 727 million on the corporate level.

At year end Formula Formula one $500 million revolver remains undrawn.

At quarter end Braves group had attributed cash and liquid investments and restricted cash of 185 million on attributed principal amount of debt of 674 million.

We are currently in compliance on all debt covenants across the portfolio.

With that I'll turn it over to Stephane to discuss Formula one.

Thank you, Brian I'm, sorry, first of all day, none of it to the former one.

Thank you to Liberty the FAA the teams in all of our partners for the World Welcome.

Before I start that want to thank James for his tireless work over the past four years and building an organization that gives us a very strong foundation for the growth into the tape that low.

It was a challenge for everyone around the globe and everybody's on the sport felt the impact of that from them.

<unk> delivered what many thought was impossible instead at the races, kolenda delivered safely and with huge enthusiasm from our expense.

72% zinc one does improve over the past two years, 68% believed that one is in good hands on the Liberty media.

71% rate their satisfaction with being in that one eight or Ohio.

Furthermore, funds believe Puma, one hand book, it's safely very very well during the global from dentists with 90%, believing the safety measures put in place to allow races to go ahead and have been handled well, 81% believe in F. One is communicating well with hence during the shutdown from 73% believed in F y.

As handbook, the absence of fans on the rates as well and 88% feeling positive about the commander in 2000.

We all continue to navigate the challenges of COVID-19. This year, however that would not preclude us.

These and opportunities we've seen from device, which are number one moving the drivers of the centralized one.

They represent the soul and albeit possibility sport.

Level of talent, we have today on the grid is one of the highest debt one history and we should celebrate that.

Number two.

Delivering on incredible product debt.

Incentive compensation and action on the track, including 23 races. This year.

On the three enhancing the long term prospect of sport and shooting as attractive business model for all participants and attracting a new participant number for remaining committed to our action to our release as one platform focused on sustainability diversity and inclusion and community.

So we reflect on 2020, we were they swimming crowd to complete a successful 17 race season than last few races brought some new places to podium include in their <unk>, we so central Paris, claiming they supposedly win alongside that's the total corner last rule in the same time in the same rates, we were relieved to see.

Gross on walk away from a theory crash.

On to a man.

Support teams on the track and improve safety measure in the sport.

On a stop and secured the window of our last where I'm, putting up with Abbvie, which capped a very successful season per rep Booth, who placed second in the constructor spending.

On the financial flows clearly we were impacted by COVID-19, but working in collaboration with our partners to mitigate these impacts.

Due to debt reduced number of races duration of the season that almost no fan attendance on Suprisingly primary revenue declining architectures.

We worked with outlook from what would cause the extent conflicts we have mutually agreed to work with certain sponsor to defense selected Reits into future years. We approach these agreements with the spirit of partnership and largely isolated the old contract impact 2020.

Great collaborations together with the ongoing symbols on accounts that leave us well positioned with all of our material commercial apartments are we entering 2021.

For the full season, we are pleased with the reaction from our fans across multiple platforms. We made significant gains the growing social platforms, making us the second fastest growing major sport leaking sales lets call over across the four major social platform ahead of major sports such as NFL NBA PGA two MW.

<unk> we.

We have seen the fastest growth in the digital engagements compared to all other major support within the 99 per cent decrease in 2020.

On television our average orders per grumpy was $87 4 million very marginally down on 2019, but still higher than the average over the 2018.

Compared favorably to other major sports with an international footprint, that's excreta speeds decline it doesn't 'twenty due to the pandemic.

We plan to engage more sales in 2021, and we have support on exciting 22 races. Coloring book. These include the addition of Saudi Arabia and much anticipated race in net on that difference.

We will navigate the challenges of that from them, but I'm pleased with how we have already been working with our partners. We were able to the stable Australia Nathan per year and announced they would total more than 40 miles to the schedule.

All compensation with promoters have been positive since the start of the year and every one of them has made it clear that day events should be going that had the scaffold.

We'd love to welcome first back on the track and we'll be working with the local organizers on governments on that approach.

We're also grateful for the of course made by the government to allow formula one to continue to travel throughout what events do it in a time of global current time on.

Our highly robust safety procedures have proven we can travel and rates safely. Furthermore, we have evaluated the race weekend with a proposal to try on new subtleties between trades per month up some races. In 2021, the result of which would this reminds the grades for the main events on Sunday is well supported by the teams in print.

You pulled out the meeting a few weeks ago, and we will work with them and the FAA to finalize the details before the start of the season.

On the sports side, we are expecting on exciting season with loose some of the limits say despite them for their unique and he started April championship, we hope to see Ferrari, we that all that he's doing the sport.

They have played back and unexciting total the new places and lines up on degree for.

So most of the season, we were wondering what central Paris would find the driver's seat and we can't wait to see him pent up with Maximus stopping the.

Mclaren wet spectacular 2020 season finishes for the construction of standard we'll see then every Caldolor London noted on up together.

We welcome Aston Martin on an iconic brand with a seasonally champion sebastien value beyond the wheel.

We also welcomed the total number alone so to rename alpine team he's doing well by the way you told them and these recent accidents and looking forward to see him of the start of the season in Bahrain and of course, the world will be watching the made the seasonal mix you might get a pass.

Last year was momentous fulfillment on one side, the new Concorde agreement and reaching agreement on the introduction of a coast GAAP taking effect this year in 2021 net.

Major able to cover relates to them to the power unit per engine.

The demonstration of our collaboration the SBA Formula one and the teams devoted to fleets probably was developed from the start of 2022 are.

A high level of working group has been established we think who's probably income manufacturer and supplier.

As we look to the next generation of the public units for 2025, the key objective of our carbon neutrality.

Fully sustainable to us hybrid power unit significant cost reduction and of course atherectomy device to the new power unit manufacturers, we believe that the sustainable hybrid engine will be a very attractive offer for the Oems and their portfolios and provides another solution to the automobile book.

<unk> drive across the world.

Feel very positive about this probably in this area and have already had very productive conversations with existing and potential Oems about the direction forward one is moving.

Continuing on this topic, we confirm that we erased as one platform will become our official ESG platform with the three core pillars of sustainability diversity and inclusion and community. We are proud of the impact these platform as last year and will continue without what action to push forward Atlas Corp.

In the coming weeks I wouldn't meet with all the drivers to discuss with them. Our weird. He says we're on plans for this year. The deal included the rollout of our apprenticeship internship and scholarship in our sport for underrepresented groups and very important that heroes role models and champions of progress in our sport.

Despite fans around the world.

We are looking forward to season three of drive to survive hidden assets on March 19th day too.

Once again captured all the DRAM and storylines of 2020 and Theres No question. Betsy. This continued to bring new parts of this book.

If I can't express my excitement for all the opportunities approval one has in front of us and I look forward to update you on our progress, but please be sure to watch the season opening grumpy Bahrain on March 28, and with that once again. Thank you. So much I will turn it over to Ukraine. Thank you.

Thanks, Brian Thanks Stefano.

Our listening audience. We appreciate your continued interest in Liberty media and hope you all staying safe and healthy.

And operator with that I'd like to open the floor to questions.

Thank you as a reminder, ladies and gentlemen, please press star one to ask a question.

Our first question today comes from Vijay Jayant Evercore.

Thanks, I have two first.

Greg obviously with the tax sharing agreement with Sirius.

That sort of kicks in the 80%.

Obviously, you mentioned that the board will decide how capital allocation works, both that moment, but.

Given the flow through will be pretty small and.

I think that dividends will be tax rate growth that is there an expectation that we should assume debt will shift more towards dividends over buybacks, all our routes, especially on a path to sort of taking that come from private and are there any obstacles sort of on that balance is down like a squeeze on requirement of 90% anything you can share.

On sort of what happens to the capital equity capital structure sort of post.

The 80% level.

I can pull it Stefano welcome.

I just wanted to sort of get your perspective.

You mentioned in the press, suggesting that you're looking for more quality over quantity in terms of races, and obviously you're talking about expenses.

Do you think you'd need to change the format of the race weekend as a neutrally.

Pay practices and making it the biggest tactical can you just talk about what you really think is the opportunity to make that we can think of event book it. Thank you.

So I'll go first and chat a little bit about dividends capital allocation and alike.

First of all it really is a decision of.

The full board.

You would know correctly that on the margin.

We would probably have a slight tilt towards dividends, we at Liberty media Liberty Siri compared to where we once were but it's really not that big a tilt while we're looking at that.

Sure.

No the discount.

Running about just under 28% substantially tightened from the 45% when the G M E Luo.

We were running more like in the mid to low 30, so we have tightened it.

But that's still quite large compared to even the 7% rate we would normally pay with the DRG.

So I don't think a huge from on the scale for Liberty.

More on.

Oriented towards dividends, but not massively but that decision really will be driven by management and the board.

As far as triggers a that might involve I would say the independent board will have to make their organizations, but one thing I think would likely be in the back of their minds or do we get to 90%.

We could do a short form squeeze out merger of the remaining 10%. So some directors might think about the pace at which we would get to that kind of a number.

But again those decisions really will be made by the full board and.

At some point.

Directors will have voiced about ensuring that the minority is price.

Appropriately protected.

Okay. That's my go to to answer to the question with regard to the format on the on what we are thinking and to improve income up show first of all have you say that that would have objected to supply to offer to the people that come into the event to the people that are watching TV. So the people that are really sounds approval on.

Somebody that he's excited so the idea that we have share then I think debt. We have received great feedback from everyone. In the sport is that that we will try to figure out something that would give us a quantified on Friday Saturday does pinch wastes that would determine the grid order for the Sunday race. So, though it gives the thrill of a great weekend.

Beneficial for all day parts in boats and this is something that we are detailing with it with the themes that play in the next weeks in order to present the final four months before the top of the seasonally low range, but that's the aim of what we have worked with try to do this year in that respect.

Thanks, So much book.

Our next question comes from David Karnofsky of J P. Morgan.

Alright, Thanks for taking the question welcomes Toronto can.

Can you discuss the.

Friends on engine development and how you think this might impact on track competition and then just maybe expand a bit on your view of F. One long term income goals in light of some of the Oems like GM and Jaguar moving toward the all electric vehicles.

Well. Thank you David for the question I think that what is important to say that the vs. Ideal prison one year in advance is connected to the new business sustainable approach. The per one has taken you know we would have taken on this year with the cost cap that is related to a certain part of the cost of mentioned the theme. The other part of it was not.

March about very important was how we can capture the controls of investment of course is in the normal business on the power units before by associated the fact that we would anticipate that the end of spending you might need for a new engine, we will see how we can capture the attention on potentially manufacturer, but also.

Making sure that the ones that we book today I think threats in the future. So we do believe by being the I bridge in the future is the exact.

Position that will allow all the manufacturers who have an access to at least from the portfolio Latonia certification for their normal business. So therefore, I think that what we're putting in place in that respect hadn't carbon neutrality fully sustainable fuels on the center and beat I, but gave us a really great position in simple package.

And from a bean overs at the Pinnacle of the technology of advanced research and put them on and making sure that everyone can benefit from visa activity also to have a a sort of wrote relevancy extra activities that can be beneficial to all the automotive manufacturers and by doing that we're going to have a win win situation a lot of attention on power.

Only thing a different way of only being electric having the cost control under under under control and of course being are aligned with our value will be sustainable for the future. So these are the basic thinking that we're taking when we decided to go on total desktop.

Okay, and then I believe there's a number of great promotion contracts expiring. If you had on this year I think Singapore on U S. Just wondering how you're thinking about F. One step into these regions versus maybe adding new races on other flyway markets I think you've mentioned in South Africa recently, and then with regards to the Vietnam GP is there any update you can provide on.

On whether we might see debt relief at some point in the future.

Well, yeah, I mean for sure we're in a great moment because of the.

Despite the pandemic, we are receiving an incredible number of requests bye bye bye that shows that the F. One of the Central basin, it's not totally from the organic drove the over all around the world, but also from the Motorsports commodity for our strategic plan is that to the side first of all what is the right they mentioned it.

Races in the year. The comfort that you are mentioning are expiring, but there are discussions on ongoing because they weren't that the weather comps.

See them on a really important and there is a lot of interest to progress in and keep them.

So in the future.

We confirm as you said.

As you know that's a U S. A is very important and strategic market for us and.

We have a be able to add another race in the U S. A we have already great Party and the last thing, but we are looking at for other solutions that are would be very important for us.

What I can see with Vietnam for whatever reason to happen do you see we didn't have the race, but for sure.

EDA far east in general, but is very important for this particular growth, although our business in the future and for sure. That's an area, where we're going to exploit the other opportunities for the future.

And if I could just ask Stefan on his comments, which I agree with you.

We do not have an unusual number of promoter contracts expiring. This year are pretty much in any year, we have a portfolio or a certain number get renewed every year just like we have a certain number of broadcast contracts that get renewed every year and in general because we think demand will ride for our sport.

Don't fear that we actually appreciate that because we think theres more opportunity it had been behind.

Thank you.

Our next question comes from Ben Swinburne of Morgan Stanley.

Thanks, Good morning, guys.

I wanted to ask both Stefano on Greg just a question around sports rights and sort of the state of the market right now maybe Europe and U S.

You guys had a very successful at least based on the press reports renewal in Germany with Sky last year, but we've seen some of the some of the other deals as debt.

Have happened or are happening have gone backwards, you know EPL the Bundesliga in and at least the press suggests Syria.

It may roll back.

And even in the U S. There's been probably more tension unusual and Greg obviously with Sinclair and what's going on there and Fox sports is clearly tricky with cord cutting. So maybe can you guys just give us sort of a sense as you as you move through 'twenty, one and 'twenty two how you're feeling about your position both with F. One and the Braves.

I think the market has gotten you know either more complicated or more challenging than it was a couple of years ago.

That's why you aren't taking kind of a happy too.

Okay I mean in my opinion on the wish you are living today is for shorter interesting from one side, but very very good about the outlook I mean, what we can see that as you know on our business model. The broke cuts or partners that are huge and important for us, but we can see on very good opportunity to do it.

Stendal and explore different models to as I said to be complementary platforms and provide the direct connection to their fan base. Both on the OTT world, but these are still stuff.

On ore that we will for sure give and I are very important for the future but to be honest I do believe that the each we're able to attract as we are doing.

This port you know the commercial accounts because they tell us is there and we need to make sure that this book we are shaping up for the future give the complex to make sure that is deliverable to defense and that's why we have a lot of activity connected to make sure that first of all of course, we don't lose the traditional and am very religious fans, but we need to speak.

The language that the new support that the new fence. The young generation. So we have a lot of programs to make sure that this has happened already this year, so I'm positive on debt to be honest.

I agree with Stephane I was comments, but I had a couple more if I could then.

You know we've done a lot over the last few years. Thank you Chase and now thank Stefano to try and build fan interest in fan excitement and that's better on track competition, that's more balanced field that we get as we go into 'twenty. Two that's a lot of ancillary things like fan festivals like programming like drive to serve.

Volume all of those building fan interest.

Obviously esports component as well.

It's an important component when you obviously go from renewal how much fan interest how much excitement there is.

Probably the most important component is how much competition there is amount of potential bidders distributors on your product and candidly the best deal, we have probably as our UK deal and it was largely because there were several bidders highly interested in getting a product I do feel it's definitely notes, we have a relative value you've seen.

And some of the other higher cost European alternatives, but if you look on any kind of basis about what cost per eyeball cost per hour et cetera.

If one looks like a relative value.

And I'd make a side note, then which I'm sure you can appreciate with the rising cost of alternatives like scripted content as that gets more expensive in some ways. It provides a floor on what the value of some of the live sports can be historically live sports book, So expenses, maybe not quite as much when scripted continues to rise.

So I'm excited about <unk> prospects, but above all we would benefit from increased competition, which is potentially some of the new digital players entering an estimate and we'll see if we can get them excited I do believe ultimately they will be competitors and that will be to our benefit.

As far as looking back at U S rights on the brand.

Obviously, we've had a world where the bundle has caused a lot of overbuy, whether it would be for a sport of all kinds of sports programming, including the RF.

And is that bundled breaks there is risk around.

What the total amount paid two teams will be including the Braves I feel relatively good about the grades are con.

Contracts from <unk> 27.

First and secondly, we have a good contract from faraway not the highest.

Well below somebody like the Dodgers, but in contrast, we have the largest broadband households.

Audience. So the brands have the largest territory with 12 million broadband households, sort of degree you look at digital alternatives on the like we are probably in the best shape.

Compared to many.

It is new.

Alternatives to rise in the bundled potentially.

Weekends.

So tell me if that good luck on the Nols. This decision. Thank you.

Yeah.

Yeah.

Our next question comes from Bryan Kraft of Deutsche Bank.

Hi, good morning.

A couple of questions first can you Greg can you talk about your current expectations for what I'll call. The path to normalcy for your live event businesses looking out over 'twenty, one and 'twenty two on.

There's obviously a lot of you know.

Focus in the market by investors on how quickly.

Businesses like these are going to be able to bounce back and weather.

Half of 'twenty, one looks normal R 22 looks normal so would just love to get your thoughts on on what Formula One live nation, the Braves, what that what that path looks like for them.

And then just quickly on the leverage target for Formula. One can you just remind us what your target leverage ratio is and is there any thought to running that balance sheet more conservatively in the future just given the experience with the pandemic or are you still comfortable with that thank you.

So I'll start on that.

The opening is certainly not binary and it's not binary in a lot of ways because debt.

One and the Braves.

Multiple sources of revenue.

<unk> got three big pillars, right broadcast, which was impeded, but probably will be needed less.

In 'twenty, one regardless of the pandemic sponsorship and advertising, which was impeded less in 2020 than than certainly the fan component on the promotion component, but again, probably less in 'twenty and 'twenty, one and then fans and we're gonna have a variety of alternatives where fans will be to some degree.

Three there and I don't think again it'll be binary we're not necessarily going to see zero to 100, it will be somewhere potentially in between so I'm more optimistic as we go to the end of the year, we're going to get to a 100 per cent of capacity.

And the same thing with the Braves multiple revenue streams, both television and.

On site, but we don't really have is we do have sponsorship is not as large a component of the visit formula one.

I think again not binary.

The expectation is we'll probably start out at 25%.

I mentioned already the majority is relatively open.

We will be in far better shape from.

The fan attendance than if you were in New York, or California, or some other locales.

And it will be decided not by baseball, but by the local rules on authorities.

So the expectation is we will have increasing numbers there.

But again not binary I don't think we're going to go from 25 to 100 in the space of a flip of a switch and obviously live nation.

It doesn't have has obviously advertising and sponsorship doesn't have the broadcast elements of what's the most responsive are vulnerable or affected by shutdowns.

Offset to that is global business really with the potential for very different responses, depending on where you are in the world.

So I think formula one in particular is preparing for.

A.

Our balance sheet that is.

<unk> whenever it comes.

And we're fully supportive of that.

I do think they will have the fans at events this year, but certainly you've already seen some of that and it will grow they announced earnings slightly ahead of expectations I think just yesterday.

But meaningful efforts there will still be I'm definitely work to be done throughout 'twenty one.

So that's kind of on that's probably somewhat of an on answer Brian because we certainly arent on a crystal ball business exactly but we are in the business of trying to prepare to make sure we benefit when it does open and then we're prepared if that doesn't happen at the rate of pay or change your pace that we would like and I think all three of those businesses.

As are well prepared and that sort of turns the balance sheet question.

I think.

One of the things about being part of the Liberty group as you can we have the ability to.

Hopefully look ahead and be thoughtful from the benefit of our operating companies.

Formula one balance sheet is very very strong I think the operating levels that we have on our agreements are fine and I. Obviously, they have a strong growth of the F. One operating level and then when you look at the cash on the flawed level. It's.

It's quite strong so I'm not really worried about the balance sheet.

Great. Thanks for that and just to answer your question real quick on the leverage target our stated leverage target on Formula One is five to five five times.

And as you recall, we have a our 825 Max leverage has been waived through March 31, 2022, and when we bought the business. It had debt approaching at eight times leverage and we substantially delever on it not only true cash operations generated but we did have a primary equity issuance as well so both of those.

Reduced the leverage even prior to the pandemic.

Got it okay. Thank you I appreciate it.

Thanks.

Our next question comes from David Beckel of Fernberg capital.

Hey, Thanks, a lot for the question.

Sort of piggybacking on your commentary about reopening I was wondering if you could help.

Help us think about a revenue recognition for the promotion side really all the revenue streams under a variety of different scenarios. It seems as if the vaccine rollout.

For the most part is going better than expected in many parts of the world should we be thinking about waste promotion revenue.

<unk> been materially affected and each one or is that somewhat protected given the concessions you made last year.

Then.

Sort of as a follow up to that so I'd love to hear your thoughts to the extent you're willing to share on how the team payment structure.

Earnings or EBITDA, one this year, specifically, maybe if you could frame it low and.

In reference to 2019 levels.

EBITDA level pre teen EBITDA exceeds 2019 should we expect marginal upside in.

Per year.

So.

I think promotion will be still reduced in 'twenty, one certainly versus what we would have on a non pandemic here, we will have to restricted audiences and restricted fan at some of our events. So I do expect them or not.

To make a forecast in part because some of this is still up on the air.

Floating around but also because that's where it can.

We'd like to let you do.

So how much will be it'll definitely be impacted the amount to which we'll see and Ah.

Going forward.

We have the new Cochrane agreement, we have a structure, which as we.

Increased profitability, we have the opportunity to take back some of what.

Historically F. One earn comparatively over the years the rates get a little more attractive for us whether we'll hit that in 'twenty, one given the risks around pandemic I'm not as confident but in the years going forward as we continue to have a fully healthy business I do believe are our share of the margin will slightly increase Stefano would you add anything.

I couldn't agree more and I think that from what is important debt with the new government. So with the new Concorde agreement with the new you know.

Cost control measure you know, it's given the sustainability of proof that allow us to think bigger and this is something that I do believe that these are really the right fundamentals to that drives it that way both from a commercial point of view and also from the <unk> perspective to be part of this is incredible.

Sure.

Great. Thanks, Bob.

Thank you.

The next question today comes from David Joyce of biopsies.

Thank you very much.

Couple of questions one on the broadcast side of the Formula one business for for.

For this year would there be any lingering COVID-19 related impacts or should we think about it as being sort.

Sort of comparable to 2019 and grossing up for step ups escalators and number of events.

And then secondly on the briefs with the.

Sinclair our ascent agreement.

And this was already touched on a little bit earlier on recall.

Where do you stand with that with them moving towards having a hybrid over the top model how does that play into your.

Economics and work on that do for further fan engagement.

And even those that could tie into sports betting once that becomes.

Something on the horizon in Georgia. Thank you.

Thank you.

So we expect a fairly normal broadcast revenue stream.

And in light of our 23 races now.

Ken.

Crystal ball about exactly how COVID-19 plays out, but our goal was to try and.

Take the pain in 'twenty.

Three that we rightly had to make concessions to where some of our broadcasters are in total as much as possible was to make that a 'twenty event and bring 21 back to normal but that is our open our expectation.

But COVID-19 could change out.

And on the.

Thinking about the RSM.

As I said, we have our contract runs to the end of 2007.

I know Sinclair is trying to do some different things, it's not clear to me exactly what rights Sinclair has to do some of the things that they think they can do or want to do I know there've been some.

Discussions with baseball about your alternatives, but I do not expect a major change assuming we can run a full 162 games schedule on a normal pace. So I would expect we would have normal revenue streams from Sinclair.

Certainly in 'twenty, one and through the rest of the contract.

<unk>.

Whether they're new engagement models that help us with Sinclair that could be on it we'll see again I'm not exactly sure what's on Sinclair thinks their rights are to do some of those things but.

Mr. Mitch Ripley's job.

And just.

Finally on the Covid impacts on <unk>.

Formula one.

In broad strokes, how should we think about those promotion and sponsorship contracts.

The mix between fixed and variable components is there is there.

General algorithm, that's baked into the contracts or how should we think about that.

But I should think you'd look most of them.

We do not have triggers.

Any triggers that they do have we will likely to be able to meet on the other hand.

You don't take.

Our partner, who has a large international airline doing.

Basically gets shut down for all foreign travel you can decide when you're going to be a good partner with them or not from the long term and that's been our goal. So we will work with them in the way that we appreciate that they have worked with us during the difficult time.

Alright, thank you.

Thank you.

Yeah.

Our next question comes from Jason Bazinet.

Okay.

Thanks, so much.

I guess, having extra liquidity is always a good thing, but I was wondering if there's any color that you might add in terms of these amendments that you did to unencumber some of the passive equity Stakes.

Okay.

Something specific that you were that you were looking to do or.

Suddenly you have tourism from or just general Optionality.

Well, you know we're into Optionality, and Jason, but I'll, let ben or in a relatively new treasury answer.

Sure with respect to the Siri margin loan we did do an upsize, but we kept it because it saves billions shares collateralized in that loan as we had previously under the 135. So we're just maximizing our ability to access dollars.

With respect to y.

It's really a function of what happened in the previous margin loan.

We repaid it and we had a substantial number of share there on your line net secured debt.

That collateral pool, and so when we right size the loans of $200 million.

Per.

Really took seasonality shares underlying that.

To something that's closer to a realistic LTV per a larger one.

Okay I understand thank you.

Yeah.

The next question comes from John Tinker of Gabelli.

Thank you.

Terrific numbers and the battery on the freight.

Unfortunately things get a little lost given most people focus on <unk> do you have any.

Would you ever considered on any way highlighting that that valuation is on its fee.

Profit in a different way.

John when we have great analytes like you writing up the value for US we don't need on here with our come on debt.

You know I think you're right there is value in the battery it is impressive.

And it's a function both of Georgia being a relatively open places we've noted and I think really the great job that the phrase management team has done to create a secure environment.

One where people are willing to come on our end its open and that's going well.

We are on you know I'm not sure we're going to create a tracker or do something different around that but we'll try and make sure. We highlight appropriately that there is value in the battery and our real estate development. Thank you.

Thanks.

On the final question today comes from Matthew Harrigan benchmark.

Oh, thank you.

Even though our formula one probably generates more data from any other sport.

Concert with AWS, and Intel and Qualcomm. It was really 100 adult under the answer on a machine with Bernie you had a loss expenses universally agree on pre email I think he's got a lot of low to maybe having more low.

Angles, and all of that in cameras in the races.

But could you talk about the potential bidder on how you see that.

Developing it feels like you've made some strides, but there's still a lot of headroom in terms of what you could do on your on the TV side and the video game side.

<unk>.

Yeah, No I think that's a great point, Matt if you think about.

The.

And evolving world.

Where we have increased starting on the broadcast side, where we have potential for increased digital.

Players.

The number of cameras, we have the angles, we have your ability to dial up on <unk>.

Angle you won that really plays perfectly to strength of those kind of digital players and different kind of a straight linear.

So I think we were we are a sport.

We'll benefit from that increased attention on the digital side in terms of viewing.

Different experience and wanted to fans and Taylor I think you can see that opportunity ahead, it will be great.

The other point is that all of that data proprietary data.

We have begun we began to take advantage of true.

Contract with ISG that did not turn out as well as we'd like but as we go forward and look at it.

Opportunities around that I do believe there is quite a lot around gambling around spanning formation that is valuable and that we are in a very strong place relative to most sports because of the amount of data and the amount of which of it is proprietary so I think on both sides, that's a huge assets.

Thanks, Greg.

Thank you.

So with that operator, I think we're done thank you to our listening audience for your continued interest in Liberty media and we look forward to speaking with you again next quarter if not sooner.

Okay.

Ladies and gentlemen that concludes today's conference call. Thank you for your participation you may now disconnect.

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Ladies and gentlemen, thank you for standing by.

Welcome to the Liberty Media Corporation 2020 year end earnings call.

During the presentation, all participants will be in a listen only mode.

Afterwards, we will conduct a question and answer session at.

At that time, if you have a question. Please press star one on your telephone keypad.

As a reminder, this conference is being recorded today February 26th.

I would now like to turn conference over to Courtney Chun Chief portfolio Officer. Please go ahead.

Thank you and good morning, before we begin we'd like to remind everyone. On this call includes certain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995 actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in Liberty media on the most recent form 10-K on Liberty media acquisitions warm.

S. One registration statement filed with the SEC. These forward looking statements equally on the database called Liberty Media Liberty Media acquisition expressly disclaims any obligation or undertaking.

Any updates or revisions to any forward looking statement contained herein to reflect any change in the reading media, our Liberty media acquisitions operations expectations with regard there to or.

Or any change in events conditions or circumstances on which any such statement is based on today's call. We will discuss certain non-GAAP financial measures from Liberty media and serious accounts.

Adjusted OIBDA on an adjusted EBITDA, the required definitions and reconciliations from Liberty media and Siriusxm and a one and two can be found on screens press release issued today. This is available on.

Right now I would like to turn the call over to Greg, Let's say inventories permanent.

Thank you Courtney and good morning to all of you today speaking on the call. We will also help on <unk>, new President and CEO Stefano Domenicali.

And Liberty, Chief Accounting Officer, and principal financial Officer, Brian Wendling.

I'd once again like to recognize and thank our management team and employees for the tremendous job they have done moving from Covid in difficult circumstances.

Beginning with Liberty Sirius XM and I know, we continued our share repurchase since repurchasing $99 million across on our second AAN K shares and the November to January time frame.

As you know if the discount persists and we repurchased at a look through price on CRE of about $3 70 per share. We do expect to continue to take advantage of the discount opportunity in part driven by some recent balance sheet performance, we had at LLS index.

In November we raised $920.

Live exchangeable bond at 50 bps to repeat or.

Live exchangeable maturing later this year and from the call spread.

Between our seven one that originated when we did the reattribution.

In tandem we amended the light margin low and unencumbered a substantial portion of our lives equity.

Also after quarter end, we amended our siri margin loan increasing our borrowing capacity from $1 35 billion to $1 75 day.

Yeah.

Accordingly, we have generated substantial incremental borrowing capacity to go after that discount to continue to take advantage of it.

Our ownership of series six.

As of January 2019 stood at 76, 4%.

We do expect to get to 80% ownership in this year and we recently announced a tax sharing agreement between Sirius XM and Liberty Sirius XM.

The Siri Board of directors evaluates capital return strategy every quarter and we'll continue to do so if liberty get to the 80% ownership level as we expect later this year.

So let me get serious itself, we welcome Jennifer Witz, who will soon be on.

On a new CEO role in January.

The new car penetration at theory had 80% in the fourth quarter and we have line of sight to get to 82% in 2021.

Sirius XM hardware Who's now one out of every two cars on the road and the number continues to climb.

FX net self pay households listening on the digital environment out of the car grew 40% in 2020.

And stitcher has the largest share of U S podcast listening audience available to advertisers.

We do make sure you listened to the podcast of the year Office Lady.

<unk> have been to our Investor day, you know how much we loved the office.

Turning to live nation, we continue to have great demand for concerts, perhaps notably the weekend sold over 1 million tickets worldwide for its 2022 tour just one week after announcing the tour.

Clearly there is robust demand as we noted per lot of music.

<unk> also acquired a majority stake in <unk>, a ticketing livestream platform.

Current you to check out the series they have on Rufus Wainwright.

Turning on turning to the Formula One group.

As I mentioned, we have a new CEO there.

And I would say mccallion from whom you will hear in a minute.

We are planning for a record 23 races. This year.

Notably the Orange Army is ready to welcome the Dutch GP and local hero Max per stop it in September of debt.

2020 showed we have ample demand for housing races, EBITDA on short notice from both new and historic tracks.

And our from many of you have seen everything you want to see streamed on why has your get ready to two nine per season three of drive to survive, which dropped on Netflix on March 19th.

Yes.

In January we introduced Almac was back.

We raised $575 million, that's the largest corporate it's back to date.

According to <unk>, who are involved from maybe they're biased.

Were subscribed stack of all time in the first trade at 13 20 was the highest initial trade for earnings back to day.

<unk> has continued to trade well, but admittedly on paint volume we are actively in discussion with a number of targets in the TMT space.

The 20% interest in <unk>.

Is attributed to the Formula One group.

And I would remind you that the formula One group had committed.

Two <unk> purchased $250 million $10 per unit in connection with the initial fitness combination when it occurs.

Turning to the brands.

We sadly lost some icons on the brands in this off season.

And we'd like to start by paying tribute debt, notably fill Negro and of course. Thank you.

Sure.

We started to fund named after Hank guaranteed with $1 billion from the brands plus $1 million from.

Major League baseball and the Major League Baseball players Association to help grow diversity in baseball.

We are excited about our enhanced 2021 roster coming off of winning at least for our third straight season.

We did resign Marcellus net to a four year deal.

As you May recall, we came within one year, one win rather from going to last year's World series. So our guidance are ready to go ready.

Ready frame and coming off of 2020, NFL MVP occurring lbs, and more are hungry and ready.

Spring training good start.

On Tuesday, and our first strength spring training game is this Sunday, we expect vans to be on cabinets at 25% capacity.

Turning back to the home at three ballpark office tower.

We are near completion at 70% leased.

Both kitchen, Cook and Papa John's will fully occupy their space by the summer of 2021.

97% of the batteries tenants are operational which speaks to the relative openness of Georgia and.

And we believe bodes well for fans and true it this year.

We do expect to have fans from SaaS, but theyre not yet share of the peak heating capacity restrictions.

And we do have significant demand from both tickets.

A true it and spring training.

As I noted, we look forward to a great 2021 season.

Including hosting the MLB all star game on July 13th.

So with that let me turn it over to Brian for some more financial results.

Thanks, Greg and good morning, everyone.

On Liberty Sirius XM group has taken a number of steps to boost liquidity and strengthen the balance sheet.

Fourth quarter, we issued $920 million of live nation, exchangeable bonds and amended our one nation margin model unencumbered with substantial I've mentioned equity value per market.

On them.

Decreasing the shares underlying the loans from $53 7 million to $9 million.

Subsequent to quarter end, we amended our siri margin loan increasing borrowing capacity to $1 75 billion up from 135 billion at year end and borrowing an additional $125 million.

Inclusive of this additional margin loan draw on Liberty Siriusxm group had attributed cash restricted cash and liquid investments of $1 1 billion, excluding $83 million of cash and restricted cash held directly at Sirius XM.

We also had $1 1 billion of Undrawn margin on capacity at the parent level.

Note that approximately $850 million of our cash will be used in 2021 to settle the call spread between the Formula One group on the Liberty Sirius XM group and to repay our $2 two 5% live nation exchangeable bonds.

This value is based on estimates of the fair value or from the fair value of liabilities in Europe.

As of February 25th the value of the Siriusxm stock held at Liberty Siriusxm Group was $19 billion and the value of our live nation stock was $6 billion, excluding valuable operation cost per upheld at Formula one.

Valued at 370 $471 million at year end.

2 billion in principal amount of debt against these holdings total Liberty Siriusxm group attributed principal amount of debt was $12 8 billion, which includes $8 6 billion of debt at.

Sirius XM directly.

Formula One group had attributed cash and liquid investments of $1 4 billion, which excludes 265 million of cash held at Formula one.

Total and total Formula One group attributed principal amount of debt was three 6%, which includes $2 9 billion of debt at one 727 million on the corporate level.

At year end Formula Formula on $500 million revolver remains undrawn.

At quarter end brace group had attributed cash and liquid investments and restricted cash of $195 million on attributed principal amount of debt from $674 million.

Currently in compliance on all debt covenants across the portfolio.

I'll turn it over to Stefan on to discuss Formula one.

Thank you Brian.

First of all day, none of it to the former one thank.

Thank you to Liberty the FAA the teams in all of our partners for the World Welcome.

Before I started I want to thank Jay for his tireless work over the past four years and building on the organization that gives us a very strong foundation for the growth into the case.

Last year was a challenge for everyone around the globe and everybody's on the sport felt the impact of the from debt.

From our one delivered what many thought was impossible and said that the Lakers calendar delivered safely and with huge enthusiasm from our expense.

72% zinc one does improve over the past two years.

On the 8% believed that one is in good hands on the Liberty media.

71% rate they have satisfaction with being in that one eight.

<unk> total height.

Furthermore, funds believe Puma, one hand book it safely very very well during the global from dentists with 90%, believing the seek to measure put in place to allow races to go ahead and have been handled well, 81% believe in F. One that's communicated well with hence you're going to shut down from 73%, believing that's why.

As handbook, the absence of fans of the rates as well and 88% feeling positive about the can than during 2012.

We all continue to navigate the challenges of COVID-19. This year, however that would not preclude us.

Alright, these and opportunities we see in front of US, which are number one book and the drivers of the center the last one.

They represent the soul and possibly the sport.

Tyler we have today on the debate is one of the highest debt one history and we should celebrate that.

Number two.

Delivering on incredible product debt.

Nathan its competition and action on the track, including 23 races. This year.

On the three enhancing the long term prospect of sport and shooting as attractive business model for all participants and attracting new book Thats been the number for remaining committed to our action through our release is one platform focused on sustainability diversity and inclusion and community.

So we reflect on 2020, we were extremely proud to complete a successful 17 race season.

The last few races brought some new places symposiums, including the <unk>, we saw sales you bet as many.

It's supposed to be when alongside that as the total corner last rule in the <unk>.

<unk> time in the same rates, we were relieved to see room on growth John walk away from a theory crash based them on to a man the support teams on the track and improve safety measure in the sport.

From a stop and secured the window of our last ramping up the value, which capped a very successful season cold weather boot, who placed second in the constructor standard.

On the financial flows clearly wasn't impacted by COVID-19, but were getting collaboration with our partners to mitigate these impacts.

Due to debt reduce number of races duration of the season that almost no pan attendance on Suprisingly primary revenue declining on Katanga. However, we work with outlook from what would cause the extent conflicts. We have mutually agreed to work with certain sponsor to defense selected right into future years net proceeds agreement.

With a spirit of partnership and largely isolated the old product to impact 2020.

Great collaborations together with the ongoing turbos on accounts that leave us well positioned with all of our material commercial department, we entered in 2021.

For the full season, we are pleased with the reaction from our fans across multiple platforms. We made significant gains the growing social platforms, making us the second fastest growing major sport leaking total followers across the four major social platform I had the major sports such as NFL NBA PGA two MW.

Absolutely we.

We have seen the fastest growth in the digital engagements compared to all other major support within the 19, 9% decrease from 2020.

On television our average orders per Grumphie was $87 4 million very marginally down on 2019, but still higher than the average over the 2018.

Compared to February two other major sports with an international footprint, that's excrete on speeds decline it doesn't 'twenty due to the pandemic.

We plan to engage more sales in 2021, and we have support on exciting 22 races calendar. This includes the addition of Saudi Arabia and much of dissipated race in net doesn't that difference.

But to get the challenge of that from then but I'm pleased with how we have already been working with our partners. We were able to this debt Australia later in the year and then now total more than 40 miles of its Kevin.

All compensation with promoters have been positive since the start of the year and every one of them has made it clear that day events should be going that had that scheduled with.

We'd love to welcome pass back on the track and we'll be working with the local organizers on governments on that approach.

I'm also grateful for the of course made by the government to allow formula one to continue to travel throughout would've events. During a time of global quote on time.

Our highly robust safety procedures have proven we can travel and rates safely.

The more we have evaluated the race weekend with a proposal to try on your subtleties between trades per month up some races. In 2021, the result of which would remind the grades for the main events on Sunday is well supported by the teams and principles at the meeting a few weeks ago, and we will work with them and the FAA to finalize the details before this.

Total this season.

On the sporting side, we are expecting on exciting season with low sevens the limits say, despite the sort of unique and he started eighth World Championship, we hope to see Ferrari, we that old that he's putting the sport.

They have played back and I'm excited total the new pieces and lines up on degree for.

So most of the season, we were wondering what central patents would find the driver's seat and we cant wait from seeking pad up with Maxim with top.

The cloud on wet spectacular 2020 season finishes 30 constructive Stephanie we'll see then there'll be cab on London noted on up together.

We welcome Aston Martin and iconic brand, we do not excuse me on the champion Sebastien belly beyond the wheel. We also welcomed the total number of loans so to rename alpine team he's doing well by the way you pull away these rates from the accident and looking forward to see him on this.

Of the season in buy rate and of course, the world will be watching the made the seasonal mix you might get a pass.

Last year was momentous fulfillment on one side, the new Concorde agreement and reaching agreement on the introduction of a co step taking effect this year in 2021.

Made you were able to cover relates to them to the power usually thought engine demonstration.

Demonstration of our collaborations the SBA pools and the teams devoted to fleets probably it was developed from the start of 2022.

A high level working group has been established we think who's probably on the manufacturer and food supplier.

As we look to the next generation of the public units for 2025 day.

The objective of our carbon neutrality truly sustainable to us hybrid power unit.

Net because of cost reduction and of course.

Moving to the new power unit manufacturers, we believe that the sustainable through the hybrid engine will be a very attractive offer for the Oems and their portfolio and provides another solution to be able to mostly they're carbonization drive across the world.

I feel very positive about this probably can do better and have already had very productive conversations with existing and potential Oems about the direction for one is moving.

Continuing on on these topics, we confirm that we erased as one platform will be count level official ESG platform with the three core pillars of sustainability diversity and inclusion on community. We are proud of the impact these platform as last year.

And we'll continue without what action to push forward average port.

In the coming weeks I will meet with all the drivers to discuss with them our weird eight cents on plans for this year. The deal included the rollout of our apprenticeship Eastern Michigan <unk> Congress you'd be in our sport for underrepresented groups and very importantly, got heroes role models and champions of progress in our sport that is probably.

Fans around the world.

We are looking forward to season three of drive to survive hidden assets on March 19.

Once again captured all the drama and story lines of 2020 and Theres No question Betsy. This computers can bring new parts of this book.

I can't Express my excitement about all the opportunity pool, one has in front of us and I look forward to update you on our progress, but please be sure to watch the season opening grumpy Bahrain on March 28, and with that once again. Thank you. So much I was told me over to you Greg. Thank you.

Thanks, Brian Thanks Stefano.

Our listening audience. We appreciate your continued interest in Liberty media and hope you all staying safe and healthy.

And operator with that I'd like to open the floor to questions.

Thank you as a reminder, ladies and gentlemen, please press star one to ask a question.

Our first question today comes from Vijay Jayant Evercore.

Thanks, I have two thoughts.

Greg obviously, the tax sharing agreement with Sirius.

That sort of kicks into 80%.

Obviously, you mentioned that the board will decide on how capital allocation works, both that moment, but.

Given the book will be pretty small.

I think that dividends will be tax rate. Both that is done on an expectation that we should assume debt will shift more towards dividends or buybacks or a lease will certainly on a path to sort of taking the company private.

And are there any obstacles setup on that that we've done like the squeeze out requirement of 90% and anything you can share on sort of what happens to the capital equity capital structure post.

The 80% level and second book Stefano welcome.

I just wanted to sort of get your perspective, you've been mentioned in the press, suggesting that you are looking for more quality over quantity in terms of races, and obviously you're talking about expenses.

Really think you'd need to change the format of the race weekend uniquely.

Pay practices and making it the biggest Mexico can you just talk about what.

What do you what do you think is the opportunity that we can think of events broadly. Thank you.

So I'll go first and chat a little bit about dividends capital allocation and the like.

First of all it really is a decision on.

The full board.

You would know correctly that on the margin.

We would probably have a slight tilt towards dividend, we at Liberty media Liberty Siri compared to where we once were but it's really not that big a tilt while we're looking at debt.

Net.

The discount.

To NAV would be running about just under 28% substantially tightened from the 45% when the G. M E Luo.

We were running more like in the mid to low 30, so we have tightened it.

But that's still quite large compared to even the 7% rate we would normally pay with the D. R D.

Exclusion so I don't think the huge from on the scale for Liberty, we are marginally more.

Reenter towards dividends, but not massively but that decision really will be driven by management and the board.

As far as triggers.

That might involve.

Sales of independent board will have to make their organizations, but one thing that I think would likely be in the back of their mind, but we get to 90%.

We could do a short form squeeze out merger of the remaining 10%. So some directors might think about the pace at which we would get to that kind of a number.

But again those decisions really will be made by the full board and.

At some point.

On the directors will have voice about maturing debt the minorities price appropriately protected.

Okay. That's my go to to answer to the question with regard to the format on the on what we are thinking to improve income up show first of all have you say that that would have objected to supply to offer to the people that come into the event to the people that are watching TV. So the people that are really it sounds approval on some.

Somebody that he's excited so the idea that we have share then I think debt. We have received great feedback from everyone. In the sport is that that we will try to figure out something that would give us a quantified on Friday. So I think those pinch waste that would determine that the grid order for the Sunday race. So though it gives the thrill of a great we can't that would be.

Beneficial to all day parts in boats and this is something that we have with the themes that play in the next weeks in order to present the final four months before the top of the seasoning of the range, but that's the aim of what we have worked with try to do this year in that respect.

Okay. Thanks, so much book.

Our next question comes from David Karnofsky of J P. Morgan.

Alright, Thanks for taking the question welcome Toronto.

Can you discuss that.

Freeze on engine development and how you think this might impact on track competition and then just maybe expand a bit on your view of F. One long term income goals in light of some of the Oems like GM and Jaguar moving toward the all electric vehicles.

Well. Thank you day before the question and I think that what is important to say that that these ideal prison. One day. It in advance is connected to the new business sustainable approach that for one as you know we will have taken on this year with the cost cap that is related to a certain part of the cost of mentioned the team. The other part of it was not.

March about very important how we can capture the controls the investment at cost was in the normal business on the public debate before by associated to the fact that we would anticipate that the end of the spending newmont before a new engine, we were thinking how we can capture the attention on potentially manufacturer, but also.

Making sure that the ones that we book today, adding to that in the future. So we do believe by being a hybrid in the future.

The exact position does allow in the older manufacturers, who have an access to a decent portfolio latonia electrification.

That normal business. So therefore, I think that most of their book and it plays in that respect hadn't carbon neutrality fully sustainable fuels on the center and beat I, but gave us a really great position in simple package and some have been always at the pinnacle, but technology on advanced research and put them on and making sure that everyone can benefit.

From visa activity also to have a a sort of wrote relevancy extra activities that can be beneficial to all the automotive manufacturer and by doing that we're going to have a win win situation.

The pension will probably the only thing on a different way of only been electric having the cost control under under under control and of course being a.

Aligned with our value will be sustainable for the future. So these are the basic thinking debt that were taken when we decided to go in total this path.

Okay, and then I believe there's a number of rate promotion contracts expiring at the end of this year I think Singapore and was wondering how you're thinking about Epsilon and today's region vs.

Maybe adding new rates, there's another flyway markets I think you've mentioned in South Africa recently, and then with regards to the Vietnam. GP is there any update you can provide on whether we might see that rates at some point in the future.

Well, yeah, I mean for sure we're in a great moment because.

But then we had received it on an incredible number of requests bye bye bye that shows that the F. One of the central beat that is not totally from the organized over there over all around the world, but also from the motorsport community, but for our strategic plan is that to the side first of all what is the right dimension in terms of rates.

In the year the comfort that you are mentioning the Arctic spotty, but the debt either discussion on ongoing because they want that they were considering at a really important and debt. He has a lot of interest to progress in and keep them. You know also in the future.

We confirm as you said.

As you know that the U S is very important and strategic markets for us and.

We have a D. A M to add another race in the U S. We have already great partnering in those things, but we are looking at for other solution debt.

It will be very important for us.

What I can see with Vietnam for whatever reason that happened you see we didn't have the race, but for sure that these Atlanta far east in general, but is very important for this piece of growth, although our business in the future and for sure. That's an add on what we're going to exploit the other opportunities for the future.

And if I could just add to Stefan on his comments, which I agree with you.

We do not have an unusual number of promoter contracts expiring. This year are pretty much in any year, we have a portfolio or a certain number get renewed every year just like we have a certain number of broadcast contracts that get renewed every year and in general because we think demand will ride for our sport.

Don't fear that we actually appreciate that because we think there's more opportunity had been behind.

Thank you.

Our next question comes from Ben Swinburne of Morgan Stanley.

Yeah.

Thanks, Good morning, guys.

I wanted to ask both Stefano on Greg just a question around sports rights and sort of the state of the market right now maybe Europe and U S.

You guys had a very successful at least based on the press reports renewal in Germany with Sky last year, but we've seen some of the some of the other deals as debt.

Have happened or are happening have gone backwards, you know EPL, the Bundesliga and at least the press suggests Syria.

It may roll back.

And even in the U S. There's been probably more tension unusual and Greg obviously with Sinclair and what's going on there and Fox sports is clearly tricky with cord cutting. So maybe can you guys just give us sort of a sense as you as you move through 'twenty, one and 'twenty two how you're feeling about your position both with F. One and the Braves.

I think the market has gotten even more complicated more challenging than it was a couple of years ago.

That's why you aren't taking kind of a happy too.

Okay.

In my opinion the ways you are living today is for shorter interesting from one side, but very.

What we can see that as you know on our business model. The broadcaster poppy is hugely important for us, but we can see a very good opportunity to extend and exploit beat from the modem to as I said to be complementary platforms and provide the data connection to their fan base both on the OTT.

Would that these are still something.

I know that that we will for sure give and I are very important for the future but to be honest I do believe that that you feel are able to attack that is we are doing.

This board you know the commercial accounts because they used that if he's there and we need to make sure that this book, we are shaping up for the future give the context to make sure that is deliverable to defense and that's why we have a lot of activity connected to make sure that first of all of course, we don't lose the traditional and very religious fans, but we need to speak.

The language the new support that the new fans. The young generation. So we have a lot of programs to make sure that this has happened already this year, so I'm positive on that to be honest.

I agree with Stephane I was comments, but I had a couple of more if I could then.

You know we've done a lot over the last few years. Thank you Chase and now thank Stefano to try and build fan interest in fan excitement and that's better on track competition, that's more balance field that we as we go into 'twenty. Two that's a lot of ancillary things like fan festivals like programming like drive to serve.

Volume all of those building fan interest.

Obviously esports component as well.

As an important component when you obviously go from renewal how much fan interest how much excitement there is.

Probably the most important component is how much competition. There is among potential bidders distributors of your product and candidly the best deal, we have probably as our UK deal and it was largely because there were several bidders highly interested in getting on product I do feel it's definitely notes we have a relative value you have seen.

And some of the other higher cost European alternatives, but if you look on any kind of basis about what cost per eye ball cost per hour et cetera.

What looks like a relative value and I'd make a side note then which I'm sure you can appreciate with the rising cost of alternatives like scripted content as that gets more expensive in some ways. It provides a floor on what the value of some of the live sports can be historically live sports book, So expenses, maybe not quite as much when scripted continues to rise.

So I'm excited about <unk> prospects, but above all we would benefit from increased competition, which is potentially some of the new digital players entering an estimate and we'll see if we can get them excited I do believe ultimately they will be competitors and that will be to our benefit.

As far as looking back in U S Reits on the brands.

Obviously, we've had a world where the bundle.

It's caused a lot of overbuy, whether it'd be for support of all kinds of sports programming, including the RF.

And is that bundle breaks there is risk around.

What the total amount paid two teams will be including the Braves I feel relatively good about the brace.

Contracts from 27.

First and secondly, we have a good contract from faraway not the highest.

Well below somebody like the Dodgers, but income.

Contracts, we have the largest broadband households.

Audience. So the brands have the largest territory with 12 million broadband households, sort of the gray you look at digital on targeted on the like we are probably in the best shape.

Compared to many to benefit as new.

Alternatives to ride in the bundled potentially.

Weekends.

So tell me exactly on luck in the Middle East. This season. Thank you. Thanks. Thanks.

[laughter].

Our next question comes from Bryan Kraft with Deutsche Bank.

Hi, good morning.

A couple of questions first can you Greg can you talk about your current expectations for what I'll call. The path to normalcy for your live event businesses looking out over 'twenty, one and 'twenty two on.

There's obviously a lot of you know.

Our focus in the market by investors on how quickly.

Businesses like these are going to be able to bounce back and weather.

Half of 'twenty, one looks normal R 22 looks normal so would just love to get your thoughts on on what Formula One live nation, the Braves, what that what that path looks like for them.

And then just quickly on the leverage target for Formula. One can you just remind us what your target leverage ratio is and is there any thought to running that balance sheet more conservatively in the future just given the experience with the pandemic or are you still comfortable with that thank you.

So I'll start on that.

The opening.

It's certainly not binary and it's not binary in a lot of ways because debt.

F one and the Braves, we have multiple sources of revenue.

<unk> got three big pillars, right broadcast, which was impeded, but probably will be paid less in 'twenty, one regardless of the pandemic sponsorship and advertising, which was impeded less in 2020 than than certainly the fan component the promotion component, but again probably less than <unk>.

'twenty and 'twenty, one and then fans and we're gonna have a variety of alternatives where fans will be to some degree there and I don't think again it'll be binary we're not necessarily going to see zero to 100, Dolby somewhere potentially in between.

I'm more optimistic as we go to the ended the year, we're going to get to a 100 per cent of capacity.

And the same thing with the Braves multiple revenue streams, both television and.

On site, but we don't really have is we do have sponsorship is not as large a component of it as a formula one.

I think again not binary.

Expectation is we'll probably start out at 25%.

I mentioned already that Georgia is relatively open.

We will be in far better shape from them.

The fan attendance than if you were in New York, or California, or some other locales.

And it will be decided not by baseball, but by the local.

Rules on authorities.

So the expectation is we will have increasing numbers there.

But again not binary I don't think we're going to go from 25 to 100 in the space of a flip of a switch.

And obviously live nation.

It doesn't have has obviously advertising and sponsorship doesn't have the broadcast elements or was it the most.

Responsive are vulnerable or affected by shutdowns.

Yeah.

Offset to that is global business really with the potential for very different responses, depending on where you are in the world.

I think Florida, one in particular is preparing for.

A.

Our balance sheet that is.

Ansible whenever it comes.

And we are fully supportive of that.

The I do think they will have fans at events this year, but certainly you've already seen some of that and it will grow they announced earnings slightly ahead of expectations I think just yesterday.

But meaningful efforts there will still be indefinitely work to be done throughout 'twenty one.

So that's kind of on you know that's probably somewhat of an on answer Brian because we certainly arent on the Crystal ball business exactly but we are in the business of trying to prepare to make sure we benefit when it does open and that we're prepared if that doesn't happen at the rate of pay or change your pace that we would like and I think all three of those businesses.

As are well prepared and that sort of trying to balance sheet question.

I think.

One of the things about being part of the Liberty Group is you can we have the ability to.

Hopefully looking ahead and be thoughtful from the benefit of our operating companies.

The Formula one balance sheet is very very strong I think the operating levels that we have on our agreements are fine and I. Obviously, they have a strong growth of the F. One operating level and then when you look at the cash on the flawed level.

It's quite strong so I'm not really worried about the balance sheet.

Great. Thanks for that and just to answer your question real real quick on the leverage target our stated leverage target on Formula One is five to five five times.

And as you recall, we have a our 825 Max leverage has been waived through March 31, 2022, and when we bought the business. It had debt approaching at eight times leverage and we substantially delever on it not only true cash operations generated but we did have a primary equity issuance as well so both of those.

<unk> reduced the leverage even prior to the pandemic.

Got it okay. Thank you. Thanks I appreciate it.

Thanks.

Our next question comes from David Beckel of Fernberg capital.

Hey, Thanks, a lot for the question.

Sort of piggybacking on.

Your commentary about reopening.

If you could.

Help us think about revenue recognition for the promotion side really all the revenue streams under a variety of different scenarios. It seems as if the vaccine rollout.

For the most part is going better than expected in many parts of the world should we be thinking about wage promotion revenue.

In materially affected and each one or is that somewhat protected given the concessions you made last year and then some.

The follow up to that I love to hear your thoughts to the extent you're willing to share on how the team payment structure.

Earnings or EBITDA on one this year.

Specifically, maybe you could be pregnant low and reference of 2019 levels at.

EBITDA level pre teen EBITDA to exceed 2019 should we expect marginal upside.

In the per year.

So.

Al I think promotion will be still reduced in 'twenty, one certainly versus what we would have on a non pandemic here, we will have restricted audiences and restricted fans at some of our events. So I do expect and we're not here to make a forecast in part because some of this is still.

On the air.

Floating around but also because that's where you.

We liked it unless you do.

So how much will be it'll definitely be impacted the amount to which we will see.

And.

Going forward.

We have with the new Concord agreement, we have a structure, which as we are.

Kris profitability, we have the opportunity to take back some of what.

Historically F. One earn comparatively over the years the rates get a little more attractive for us whether we'll hit that in 'twenty, one given the risks around pandemic on not as confident but in the years going forward as we continue to have a fully healthy business I do believe are our share of the margin will slightly increase Stefano would you add anything.

I couldn't agree more and I think that's what is important that with the new government. So with the new Concorde agreement with the new you.

You know our.

Cost control measure you know eats given the sustainability of proof that allow us to think bigger and this is something that I do believe that these are really the right fundamentals the debt.

That's right both from the commercial point of view and also from the people perspective to be part of this incredible championship.

Alright, Thanks Bill.

Thank you.

The next question today comes from David Joyce of vaccines.

Thank you very much a couple of questions one on the broadcast side of the Formula one business for.

For this year would there be any lingering COVID-19 related impacts or should we think about it as being.

Sort of.

<unk> 2019, and grossing up for step ups escalators and number of events.

And then secondly on the briefs with the.

Sinclair artists and agreements.

And this was already touched on a little bit earlier in the call.

Where do you stand with the with them moving towards having a hybrid over the top model how does that play into your.

Economics, and what does that do for further fan engagement.

<unk>.

When does that could tie into sports betting once that becomes.

Something on the horizon in Georgia. Thank you.

Thank you.

So we expect a fairly normal broadcast revenue stream.

In light of our 23 races now.

Yes.

Crystal ball about exactly how COVID-19 plays out, but our goal was to try and.

Take the pain in 'twenty to the degree that we rightly had to make concessions to or some of our broadcasters are in total as much as possible was to make that a 'twenty event and bring 21 back to normal so that is our open our expectation.

But.

Covid could change that.

Morning.

And on the.

Thinking about the <unk>.

As I said, we have our contract runs to the end of 2007.

I know Sinclair is trying to do some different things, it's not clear to me exactly what rights Sinclair has to do some of the things that they think they can do or want to do.

In some discussions with baseball about you all targets, but I do not expect a major change assuming we can run a full 162 games schedule.

On a normal pace I would expect we would have normal revenue streams from Sinclair in.

Certainly in 'twenty, one and through the rest of the contract.

Right.

Whether they're new engagement models that help us from Sinclair that could be on it we'll see again I'm not exactly sure what's on Sinclair thinks their rights are to do some of those things but low.

That's true.

To wrap these jobs.

And then just.

Finally on the Covid impacts on Formula one.

Rod strokes, how should we think about those promotion and sponsorship contracts been the.

The mix between fixed and variable components is there is there.

General algorithm, that's baked into the contracts or how should we think about that.

What I should think you'd look most of them are probably do not have triggers.

Triggers that they do have we will likely be able to meet on the other hand.

Take.

Our partner, who has a large international airlines doing.

Who basically gets shut down for all foreign travel you can decide when you're going to be a good partner with them or not from the long term and that's been our goal. So we will work with them in the way that we appreciate that they have worked with us during the difficult time.

Okay.

Alright, thank you.

Thank you.

Our next question comes from Jason Bazinet.

Okay.

Thanks, so much.

I guess I have extra liquidity is always a good thing, but I was wondering if there's any color that you might add in terms of these amendments that you did to unencumber some of the passive equity Stakes.

Is there something specific that you were that you were looking to do.

We're still need that you have tourism from more just general Optionality.

Well, you know we're into Optionality, and Jason, but I'll, let Ben or in a relatively new treasurer answer sure with respect to the Siri margin loan. We did do an upsize, but we kept the same billion shares collateralized in that low end as we had previously under the 135. So we're just maximizing.

Our ability to access dollars.

With respect to y.

And so it really a function of what happened in the previous margin loan.

We repaid it and we had a substantial number of share there on your line net secured debt.

Lateral pool, and so when we right size the loans of 200 million.

Appropriate took the amount of shares underlying that.

Something that's closer to a realistic LTV per module.

Okay I understand thank you.

The next question comes from John Tinker of Gabelli.

Thank you.

Terrific numbers and the battery on the brakes.

Unfortunately things get a little lost giving those people focus on it and do you have any.

Do you ever considered on anyway, highlighting that valuation, but let's see.

Profit in a different way.

John when we have great analytes like you're writing up the value for US we don't need on here with our come on debt.

You know I think you're right there is value in the battery it is impressive.

And it's a function both of Georgia being a relatively open places we've noted.

Really the great job that the branch management team has done to create a secure environment.

On where people are willing to come on our end its open and it's going well.

We are you know I'm not sure we're going to create a tracker or do something different around that but we'll try and make sure. We highlight appropriately that there is value in the battery and our real estate development. Thank you.

Yes.

On the final question today comes from Matthew Harrigan benchmark.

Thank you, even though our formula one probably generates more data on this.

Four years in concert with AWS, and Intel and Qualcomm It was really under dissolved under the answer on Oh Gee with Bernie you got a low.

Lots of stuff is universal in Korea on pre email I think you've got a lot of low to maybe be happy more.

Look angles, and all that and cameras and the races. Eventually but could you talk about the potential bidder on how you keep it out.

Golf and it looks like you've made some strides, but there's still a lot of headroom in terms of what you could do on growth on the TV side and the video game side. Thank you.

No I think that's a great point, Matt if you'd think about.

The.

An evolving world.

Where we have increased starting on the broadcast side, where we have potential for increased digital play.

Players.

Number of cameras, we have the angles, we have your ability to dial up on angle you won that really plays perfectly to the strength of those kind of digital players and different demonstrated linear.

So I think we are a sport that we'll benefit from that increased attention on the digital side in terms of viewing.

Different experience and wanted to fan can Taylor I think you could see that opportunity ahead, it will be great.

The other point is that all of that data proprietary data.

We have begun we began to take advantage of true.

On contract with ISG that did not turn out as well as we like but as we go forward and look on the opportunities around that I do believe there is quite a lot around gambling around spanning formation that is valuable and that we are a very strong place relative to most sports because of the amount of data and the amount of which of it is proprietary.

Thanks, Greg.

Thank you.

So with that operator, I think we're done thank you to our listening audience for your continued interest from Liberty media and we look forward to speaking with you again next quarter if not sooner.

Ladies and gentlemen that concludes today's conference call. Thank you for your participation you may now disconnect.