Q4 2020 Liberty Media Corp Earnings Call

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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 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 of 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 the.

As mentioned the Liberty media and the most recent form 10-K for Liberty media acquisitions for an S. One registration statement filed with the SEC. The department is even speak only as of the date of this call and Liberty Media and Liberty Media acquisition expressly disclaims any obligation or undertaking.

Any updates of revision anymore, but he can.

And here in terms of like any change in Liberty Media Liberty Media acquisition Corp, expectations with regard there to or any change in events conditions or circumstances on which any such statement of the space.

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

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

Now I'd like to turn the call over to the pregnancy, and Liberty's President and CEO. Thank you Courtney and good morning to all of you a.

Today speaking on the call. We will also have a 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 managing through COVID-19 and difficult circumstances.

Did you see with other Liberty Sirius XM and I know, we continued our share repurchases repurchasing debt.

$9 million across all aspects of a N K shares and the November to January time frame.

As you know the discount persists and we repurchased at a look through price a series 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. A success.

In November we raised $929 million of a live exchangeable bond at 50 bps to repair a R.

Life exchange of a maturing later this year in front of the call spread.

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

In tandem we amended amended the line 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.

Yeah.

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

Our ownership of series six of them as the.

The January 2009 stood at 76, 4% with.

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

The series of board of Directors evaluate the capital return strategy every quarter and we'll continue to do so if the liberty get to the 80% ownership level as we expect a later this year.

So looking at series itself, we welcomed Jennifer Witz, who assumed her new CEO role in January.

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

Sirius XM hardware is now the one out of every two cars on the road and the number of continued decline.

Ethics himself paint households, listening in a 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 for advertisers.

Please make sure you listened to the podcast of the year of office Lady.

For those of 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 for just one week after announcing the tour clearly there is robust demand as we noted for live music.

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

Terminate the turning to the Formula One group.

As I mentioned, we are of a new CEO there a stefano.

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

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

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

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

And for many of you I haven't seen everything you want a C screened a wireless you get ready to tune in for season, three of a drive to survive which dropped on Netflix on March 19th.

In January we introduced <unk> the stack.

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

According to the banks, who are involved for maybe they're a bias. The most oversubscribed stack of all time in the first trade at 13 20 was the highest initial trade for any spec debate.

<unk> has continued to trade well, but admittedly on a big 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 for purchase $250 million of $10 per unit in connection with the initial business combination when it occurs.

Turning to the Braves.

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

And we'd like to start by paying tribute to the notably fill knee growth and of course. Thank you.

Yeah.

We started a fund named after a Hank guarantee the with $1 million from the brands plus $1 million.

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

We are excited about our enhanced 2021 roster of coming off of a winning the had a lease 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 for.

For a free freemen coming off of the 2020 ml N V. P of Cooney of Albion and more are hungry and ready.

Spring training did start a reach.

On Tuesday, our first strength spring training game is the Sunday, we expect fans to the attendance at 25% capacity.

Turning back to the a home front the three ballpark office tower.

We are near completion of 70% leased.

Both the 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 of true this year.

We do expect the have fans in the standard, but theyre not get share of the peak heating capacity restrictions.

And we do have significant demand for both tickets.

The truth 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 of our financial results.

Thanks, Greg and good morning, everyone.

The Liberty Siriusxm group has taken a number of steps to boost liquidity and strengthen the balance sheet.

For the fourth quarter, we issued $920 million of live nation of exchangeable bonds and amended our live nation margin line Unencumber, a substantial live nation equity value for them.

Decreasing the share of underlying loans of $53 7 million for 9 million.

Subsequent to quarter end, we amended our Siri margin loan income.

<unk> borrowing capacity to $1 75 billion up for 135 billion at year end and borrowing an additional $125 million.

Inclusive of this additional margin loan draw a liberty Siriusxm group had attributed cash restricted cash and liquid investments of $1 1 billion, excluding a $3 million of cash and restricted cash held directly at Siriusxm.

We also had $1 1 billion of Undrawn margin line capacity of the apparent level.

The open approximately $150 million of our cash will be used in 2021 to settle the call spread between the Formula One group and the Liberty Siriusxm group and to repay our $2 two 5% live nation exchangeable bonds.

This value is based on estimates of the fair values are for the fair value of the liabilities at year end.

As of February 25th the value of the Siriusxm stock held at Liberty Siriusxm Group was $19 billion the value of our live nation stock was 6 billion, excluding the valuable ambition calls for upheld a formula one.

The 370 $471 million a year round.

For a $3 2 billion of principal amount of debt against these holdings total Liberty Siriusxm group attributed principal amount of debt was $4 8 billion, which includes a $6 billion of debt.

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

One of the two 727 line of the corporate level.

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

At quarter end brace group had attributed cash and liquid investments and restricted cash of a $185 million and attributed principal amount of debt of 674 of them.

Currently in compliance on all debt covenants across the portfolio.

With that I'll turn it over to Stephane, a discuss formula one.

Thank you, Brian and three of the first of all the non of it to the total one.

The two liberty the FAA the teams in all of our partners for the World and welcome Bill.

For a start I want to thank James for his tireless work over the past for years and building a localization that gives us a very strong foundation for the growth in the the tape the ahead of last.

It was a challenge for everywhere in the around the globe and everybody's of the sport felt the impact of the from them for.

<unk> delivered what many thought was impossible instead of the races calendar delivered safely and with huge enthusiasm from our plants.

72% zinc F. One of those 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 fan of eight or a higher.

Furthermore, funds believe tumor one handbook each safely very very well during the global pandemic with 90%, believing the seat the measure put in place to a low races. The go ahead I've been a handle well.

The 1% believed in F. One is communicate the well returns given the shutdown the 73%, believing the F. One of his handbook the ops.

Since the fans of the race as well and 88% feeling positive about the commander in 2000.

We all continue to love the gave the challenge of COVID-19 of this year the web.

That will not preclude us.

For these and opportunities we see in front of US which are number one the drivers of the sense of the last one day.

Represent the soul and all of the possibility of sport the.

The level of kind of we have today of the grade is one of the highest one of the history and we should celebrate that.

Number two.

Delivering an incredible product the things and its competition and action on the track, including plenty of three races. This year.

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

So we reflect on 2020, we were extremely proud to complete the successful 17 of race season. The last few racist growth some new places to podium, including the psyche of GP was so such a bad as cleanly as opposed to the win alongside that as the other corner of lost tool at the same time and at the same rates, we were relieved to see.

<unk> ROE John walk away from a theory crash.

To a man.

The support teams on the track and improve safety measure in the sport.

That's a a stop in the secured the win of our last where I'm, putting up a W which capped a very successful season for Red Bull, who placed second in the constructor standard.

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

Due to the reduced number of a basis duration of the season, the almost no fan attendance unsurprisingly prime a revenue decline in OCA segments. However, we work with other promoters of the extent conflicts where a mutually agreed the work with certain sponsor for the SaaS selected writing for future years.

We have proof of these agreements with the spirit of partnership and a large delays related the old contract. The impact 2020 discrete of collaborations together with the ongoing symbols of all accounts leave us well positioned with all of a 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 classes, making of the second fastest growing major sports league in total of color across the full of major social platform ahead of major sports such as N. A S. L. M. B, a b G. A two N <unk>.

<unk>.

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

The TV our average, though just for the grumpy 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 excreta speeds decline as a dozen 'twenty due to the pandemic with.

We plan to engage more fans in 2021, and we have set for an exciting 22 races calendar. This includes the addition of Saudi Arabia and much anticipated race in net doesn't evidence.

We will know the gave the challenge of the pump, but are pleased with how we have already been working with our partners. We were able to the stable Australia later in the year and announced the return of the more than 40 miles of the scheduled all.

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

We'd love to welcome back of the track a will be working with the local organizers of governments on that approach.

We are also grateful for the of course made by the government to allow formula one to continue to travel to other events. During the time of a global current time, our highly robust safety procedures have proven we can travel and rates safely. Furthermore, we are evaluating the race weekend with a proposal to try a new.

South of the sprint twice per month of some of the races. In 2021, the result of which will remind the grades for the main events on Sunday.

Supported by the teams in principle at the meeting a few weeks ago, and we will work with them and the FAA to finalize the the tapes before the start of the season.

Of the sporting side, we are expecting a exciting season with loose some of the limits say despite the for the unique and he started April a championship.

Hope to see Ferrari, we that all of that he's putting the sport.

A playback and I'm excited for all of the new faces in the lines up on the grid.

For most of the season, we were wondering what a central patents would find the draw the seats and we can't wait to see him pent up with Max of of stopping the.

For the cloud of wet spectacular 2020 season finishes for the construction of a standard we'll see then the recapture of London noted non up together.

We welcome Aston Martin and iconic brand with a season of the champions the best embedded at the end of the World. We also welcomed the return of but nonetheless, so two a rename alpine team he's doing well by the way. He told the way these rates in the accident and looking forward to see him of the start of the season and the rate and of course, the world will be watching that.

The the seasonal mix you might get a pass.

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

The major able to cover the relates to the to the power units of origin.

Demonstration of a collaboration the SBA pooling of one and the teams devoted to fleets probably of the development from the start of 2022 a.

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

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

A really sustainable to us hybrid power unit significant cost reduction and of course, a attractiveness to the new power unit manufacturers, we believe that the sustainable two of the hybrid engine will be a very attractive offer for the Oems and their portfolios and provides another solution to deal with the most of the pickup.

<unk>, but I have a across the world.

Feel very positive about this probably in the data and have already had very productive conversations with existing and potential Oems about the direction for one of these moving.

Continuing on this topic, we confirm the we erased as one platform will become a level of a peaceful ESG platform with the three core pillars of the sustainability diversity and inclusion of community. We are proud of the input. This platform as last year and will continue without what action to push forward of the score.

In the coming weeks I wouldn't meet the with all the drivers to discuss with them. Our we had a says we're on plans for the sheer the deal included the rollout of our a plenty.

For the I'm the represent the scopes and very important that heroes role models and champions of progress in our sport that is probably of fans around the world.

We are looking forward to seize them free of drive to survive hidden message of March 19, the two.

Once again captured all of the DRAM and the storylines of 2020 and Theres No question. Betsy that's continued to bring new parts of the sport if I can't express enough my excitement for all of the opportunities of approval. One the has in front of us and I look forward to update you on our progress, but please be sure to watch the season opening ramping by the end on March 20.

And with that once again, thank the so much I would tell me over to you Greg. Thank you.

Thanks, Brian Thanks Stefano.

Of our listening audience. We appreciate your continued interest of Liberty media and hope you, all staying safe and healthy and.

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

Greg obviously, the the tax sharing agreement with Sirius.

That's sort of kicks in the 80%.

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

Given the flow through will be a pretty small and.

I think the dividends will be tax free both of that is there an expectation that we should assume that we will shift more towards dividends or buybacks or a lease.

Secondly, on a path to sort of taking the company private and other any obstacles sort of on that that we've got a like a squeeze out of refinement of the 90% anything you can share on sort of what happens for the capital equity capital structure sort of both.

The 80% level and the <unk>.

Second for Stefano welcome.

I just wanted to sort of get you a perspective.

You mentioned in the press, suggesting that you're looking for more quality over quantity in terms of races, and obviously, we're talking about it's been to ex U.

Thank you Luc the change the format of the race weekend a uniquely.

Pay practices and making of the biggest technical can you just talk about what.

What do you what do you think of the opportunity to make the we can think of a event a brokerage. Thank you.

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

First of all of it really is a decision of.

For the full board.

You would note correctly that on the margin.

We would probably have a slight tilt towards the dividend we at Liberty Media Liberty series compared to where we want to work, but it's really not that they can tell while we're looking at the the.

Of the discount to.

N a running about just under 28% substantially tightened from the 45% when the G M a new up and.

We were running more like in the middle of 30, So we are trying to.

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

So you know I don't think the huge thumb on the scale for Liberty.

Largely more.

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 that I think will likely be in the back of their mind with it we get the 90%.

We can 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.

Kind of directors will have a voice about ensuring that the minority of the price appropriately protected.

Okay. That's my go to to answer to the question with regard to the format on the on the won't be a thinking and to improve until the show first of all of you say that that would a objective is a fly to offer for the people that the come into the events of the people. The other watching TV for the people that are really sounds a pool of lump sum.

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

Beneficial to all of the parking boats and this is something that we have the tailwind with the with the with the themes of the airplane in the next weeks you know the two presented the final for 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.

Our next question comes from a base of Karnofsky of J P. Morgan.

Alright, Thanks for taking the question a weapons Toronto can you discuss the.

Free zone, the engine development and how you think this might impact on track competition in the.

And just maybe expand a bit on your view of the F. One long term engine 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's a what is important to say that the visa idea of prison, one year and a bounce is connected to the new business sustainable approach. The for one of its taken you know we will have taken of the shoe with the cost of cats that these related to a certain part of the cost of mentioned the theme. The other part of it was a non.

March about a very important was how we can capture the control of the investment of course is in the normal business on the power units, but for a buyer associates of the fact that we would anticipate that the end of the spending new money for a new engine. We were thinking of how we can capture the attention of potentially manufacture but also.

Making sure that the ones that the book today out of interest in the future. So we do believe by being the I bridge in the future ease of the exact position that will allow all of the manufacturers who have an access to a different a portfolio latonia certification for the normal business. So the Florida I think that most of you are putting in place.

In that respect have the carbon neutrality fully sustainable fuels of the center and beat up but gave US a really great position in terms of package in terms of Dean always of the pinnacle of technology of advanced researching pool of line and making sure that the everyone could benefit from this activity also to have a a sort of a wrote the relevance.

The extra activities that can be beneficial to all of the automotive manufacturer and by doing that we're going to have a win win situation.

Lots of attention of probably the only thing in a different way of all of the bean electric a having the cost control under under the control and of course being a a light with our veda will be sustainable for the future. So these out of the basic thinking that the we're taking when we decided to go in total this pump.

Okay, and then I believe there's a number of rate promotion contracts expiring at the end of this year I think Singapore and the U S. Just wondering how you're thinking about F. One step into these regions versus the.

Maybe of adding new way for us and other flyway markets I think you've mentioned in South Africa recently, and then with regard to the Vietnam GP of any update you can provide on whether we might see that growth at some point in the future.

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

Despite the pandemic, we are receiving an incredible number of requests bye bye bye that shows that the F. One of the central base of it is not totally from the organizers of the Oh around the world, but also from the Motorsports community. The four of our strategic plan is a to the side first of all of what is the items that I mentioned in terms of.

The races in the year. The the comfort you have mentioned in the out of expiring, but the debt either a discussion of ongoing because of the ones that the weather a considering a really important and there is a lot of interest to progress in and keep them.

Also in the future a we confirm a.

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

We have a D. A M to add another race in the U S. A we have already great party of the last thing, but we are looking at for other solution debt.

It would be very important for us.

What I can see with Vietnam for whatever reason the happen you see we didn't have the race, but for sure that is an adder for the used in general but is very important for the success of growth, although a business in the future and for sure. That's a matter where we're going to exploit the other opportunities for the future.

And if I could just add the stefanos comments, which I agree with you know we do not have an unusual number of promoter contracts expiring this year a pretty much in any year, we have a portfolio for a certain number of 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 of 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 and Greg just a question around sports rights and sort of the the state of the market right now maybe Europe and U S.

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

Have happened or are happening has gone backwards, you know a P. L. A 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 of unusual and Greg obviously with Sinclair and what's going on there and Fox sports is clearly a tricky with cord cutting. So maybe can you guys just give a sort of a sense as you as you move through 'twenty, one and 'twenty two how you're feeling about your position both with a foreign and the Braves.

We think the market's gotten.

Even more complicated in a more challenging than it was a couple of years ago.

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

Okay, I mean, a in my opinion of the Super wish for a living today is for shorter interest for one side, but very very good about the other I mean, what we can see that as you know on our business model. The the broadcaster partners out of a huge and important for us, but we can see a a very good opportunity due to the.

And the and explore the for the mobile Stu as I said to be complementary platforms and provide the direct connection to the fan base both of the OTT world, but these are still a a stuff in.

In the area that we will for sure given I, a very important a night for the future, but the cause the honest I do believe that the EPA are able to attack the as we are doing.

The sport you know the commercial accounts, because they sort of sees there and we need to make sure that the the pool, we have the shape it up for the future give the context to make sure that is the livable for defense and that's why we have a lot of activity connected to make sure. The first of all of course, the they'll lose the traditional and a very religious fans, but we need to speak.

The language of the new support that the new fans of the young generation. So we have a lot of programs to make sure that these has that been already this year, so I'm positive about that for them.

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

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

All of those building fan interest.

Obviously, the esports component as well.

As an important component when you obviously go for 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 of your product and Cadillac. The best deal, we have probably as our UK deal and it was largely because there were several theaters highly interested in getting a product I do feel as Stefano notes, we have a relative value you have seen.

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

If one looks sort of like a relative value and I think a sign of bandwidth 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 of live sports like sort of expenses, maybe not quite as much when scripted continuing to rise.

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

As far as looking back a U S rights of the brands.

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

It's caused a lot of overbuy, whether it be for a sport of all kinds of sports programming, including the RSM and.

And is that bundle breaks there is risk around.

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

Of our contracts for a 27.

The first and secondly, we have a good contract of a faraway not the highest bulk.

Hello somebody like the Dodgers, but in contrast, we have the largest broadband household audience. So the brand type of a largest territory with 12 million broadband households, sort of a degree you look at digital alternatives and the like we're probably in the best shape.

Compared to many of them to benefit as new.

Alternatives arrived in the bundled potentially a weekend.

So tell me if I could look in the end of at least this a series of thank you. Thanks.

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.

There's obviously a lot of.

A 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 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 of just given the experience with the pandemic or are you still comfortable with that thank you.

So I'll start on the.

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

One and the Braves.

A multiple sources of revenue.

That's the ones 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 part of 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.

Free there and I don't think again, it'll be binary where not necessarily kind of zero to 100, it will be somewhere potentially in between.

The 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.

Of the expectation is we'll probably start out a 25%.

I mentioned already the majority of is relatively open.

We will be in far better shape for them.

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

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

So the expectation is we will have increasing numbers of 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.

Obviously live nation.

It doesn't have has obviously advertising and sponsorship doesn't have the broadcast elements of what's the most.

A sponsor of a vulnerable or affected by shutdowns.

<unk>.

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

Ah I think formula one in particular is preparing for a.

A.

Our balance sheet that is a.

Vegetable whenever it comes and we're fully supportive of that the.

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

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

A.

So that's kind of a you know that's probably a somewhat of a non answer Brian because we certainly aren't in 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 they were prepared if that doesn't happen at the rates of pay or a change of pace that we would like and I think all three of those businesses are well prepared.

And that sort of trying to the balance sheet question.

Think a.

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

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

The Formula one balance sheet is very very strong I think the operating levels that we have in all of 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 of a flawed level.

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

Great. Thanks for the interest to answer your question real real quick on the leverage target of 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 of the 2022 of them and when we bought the business. It had net approaching that eight times leverage and we substantially deleveraged at not only true cash operations generated but we did have a primary equity issuance as well so both of those.

A reduced the leverage even prior to the pandemic.

Got it okay. Thank you for thanks I appreciate it.

Thanks.

Our next question comes from David Beckel of Fernberg capital.

It makes a lot of for the question.

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

Help us think about a revenue recognition for the promotion side really all of the revenue streams under of 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.

Then.

Sort of as a follow up to that a love to hear your thoughts to the extent of willing to share on how the team payment structure.

The earnings or EBITDA of one this year, specifically, maybe if you could frame it and.

In reference of 2019 levels of it.

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

The current year.

So a.

Al I think promotion will be still reduced in 'twenty, one certainly versus what we would have in a non pandemic here, we will have restricted of audiences.

And the fans at some of our events. So I do expect them for not here to make a forecast in part because some of this is still up of the air.

Floating around but also because that's the way.

Like the unless you do a.

So how much will be it'll definitely be it.

Packet the amounts of which we will see.

And.

Going forward we.

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

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

Historically F. One earned a 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 LTE business I do believe are our share of the margin will slightly increase Stefan a would you add anything.

I couldn't agree more in a I think that the what is important that the with the new governments of with the new Concorde agreement with the new a you know them.

Cost control measure you know, it's given the sustainability a proof of the allow us the things bigger and this is something that I do believe that these are really the.

The right the fundamentals the that drives the that's the way both from a the commercial point of view and also from the <unk> perspective to be part of this the incredible championship.

Alright, Thanks, a lot.

Thank you.

The next question today comes from David Joyce of biopsies.

Well, thank you very much of a.

A couple of questions one on the broadcast side of the of Formula One business for a for this year would there be any lingering a COVID-19 related impacts or should we think about it as being a.

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

And then secondly on the briefs with the.

The Sinclair are a sign agreements.

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

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

Economics and work of the due for further a fan engagement.

Even as 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.

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

Take the pain in 'twenty.

Free that we rightly had to make concessions to where some of our broadcasters are in total as much as possible with the make that a 'twenty event and bring 21 back to normal for that as our open our expectation.

But COVID-19 could change out of just as a as a warning.

And.

Thinking about the RSM.

As I said, we have our contract runs of 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 the baseball about the alternatives, but I do not expect a major change assuming we can run a full 162 games schedule a on a normal.

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

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

Whether they're new engagement models that help us for Sinclair that can be out of it we'll see.

I'm not exactly sure what sort of a Sinclair thinks their rights are to do some of those things but.

That's a mature the.

Terrific job.

Then just.

Finally on the Covid impact for them.

Formula one and in broad strokes, how should we think about those promotion and sponsorship contracts been the cause of the mix between fixed and variable components is there is there.

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

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

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

Take a.

A partner who has a large international airline doing a.

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 for 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.

Yeah.

Alright, thank you.

Thank you.

Our next question comes from Jason Bazinet.

Oh, thanks, so much.

I guess, having the 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 the unencumbered some of the passive equity Stakes.

Was there something specific that you were that you were looking to do for.

So the need that you have chosen the more just general optionality.

Well you know we're in the Optionality of Jason, but I'll, let Ben or in a relatively new treasury answer.

Sure.

With respect of the Siri margin loan a we didn't do the upsize, but we kept it because of the same billion shares collateralized in that loan as we had previously under the 135. So we're just maximizing our ability to access dollars.

With respect a y.

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

We repaid it and we had a substantial number of shares that were out of your line of securities.

A collateral pool, and so where are we right size the loans of 200 million the.

Appropriately took the amount of shares underlying that.

Something that's closer to a a realistic LTV for a bunch of them.

Okay I understand thank you.

The next question comes from John Tinker of Gabelli.

Thank you.

Terrific numbers and the battery on the phrase.

Unfortunately, the things get a little losses, given most people focus on a do you have any.

Would you have a considering any way highlighting the valuation of the let's see.

A proxy in a different way.

John when we have great analyzed for like you're writing up the value for us we don't need anyone of our come on that's a no.

You know I think youre right there is value in a battery of an impressive.

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

One where people are willing to come in our end of its opening.

Doing well.

We I'm you know I'm not sure of it 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 in a real estate development. Thank you.

Thanks.

Of the final question today comes from Matthew Harrigan of benchmark.

Oh, thank you.

Even though a formula one probably generates more data than any of the sport.

Concert with AWS, and Intel and Qualcomm It was really 100 adult.

You've got a lot of stuff is universal occurring on a pre now I think you've got a lot of allowed to maybe have a more.

Angles, and all of the out and cameras and the races. The rest.

The only but could you talk about the the potential there and how you see that a developing.

The golfing it feels like you've made some strides, but there's still a lot of the headroom in terms of what you could do on your own.

The TV sort of in the video game side.

<unk>.

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

The.

And evolving world.

Where we have increased starting on that sort of 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 the angle you won that really plays perfectly to the strength of those kind of game for players and different kind of straight 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 in one of the fan can 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 the.

The 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 a proprietary so I think on both sides, that's a huge asset.

Thanks, Greg.

Thank you.

So with that operator, I think we're done.

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.

Ladies and gentlemen that concludes today's conference call. The 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 that 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 of the most recent form 10-K for Liberty media acquisition for them.

That's one of a registration statement filed with the SEC. These forward looking statements speak only as of the date of this call and Liberty Media Liberty Media acquisition of expressly disclaims any obligation or undertaking because of that.

Any updates or revisions to any forward looking statement.

And herein to reflect any.

Range in the reading media Liberty Media acquisition Corp, expectations with regard, there too or a change of events conditions or circumstances on which any such statement of space.

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

Adjusted OIBDA and adjusted EBITDA, the required definitions and reconciliations for Liberty media and the Sirius XM. The scheduled one and two can be found in the earnings press release issued today, which is available.

The website now I'd like to turn the call over to the break with a permanent CEO.

Thank you Courtney and good morning to all of you.

Today speaking on the call. We will also have the ones, 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 have done managed for COVID-19 in difficult circumstances.

Beginning with the Liberty Sirius XM and I know, we continued our share repurchases repurchasing $99 million across the <unk> and K shares and the November to January time frame.

As you know all of the discount persists and we repurchased at a look through price of 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 impairments, we had at L. A a success.

In November we raised $929 million of a line exchangeable bond at 50 bps to repay a R.

A lot of exchangeable maturing later this year and part of the call spread.

Between our sales have been won that originated when we did the reattribution.

In terms of we amended amended the line margin loan and unencumbered a substantial portion of our line equity.

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

Yeah.

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

Our ownership of series six and the <unk>.

January 29, 76, 4% we.

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

The series of board of Directors evaluates capital return strategy, a record and we'll continue to do so if the liberty get to the 80% ownership level as we expect later this year.

So looking at series itself, we welcome to the agenda for women, who syndrome for a new CEO role in January.

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

Sirius XM hardware is now a one out of every two cars on the road and the number of continuous decline.

FX net sales paint households, listening in the digital environment out of the car.

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

Please make sure you listened to the podcast of the year of office Lady.

Obviously, the you have been to our Investor day, you know how much we loved the ops.

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

<unk> also acquired a majority of taken beats a ticketing livestream platform.

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

Terminate the turning to the Formula One group.

As I mentioned, we are of a new CEO there a stefano.

Given the calendar from whom you will hear in a minute.

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

Notably the Orange the army is ready to welcome the Dutch GP and local hero Max for stop it in September at that one.

2020 showed we have ample demand for Alstom races, EBITDA chart motors for both new and historic tracks.

And now for many of you haven't seen everything you want to see streamed a why has your.

Get ready to tune and for season three of a drive to survive which dropped on Netflix on March 19th.

In January we introduced Almac leaseback.

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

According to the <unk>, who are involved for maybe there by at the most.

Of our subscribers back 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 mainly on the trade 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 has committed.

Two for purchase $250 million and $10 per unit in connection with the initial business combination when it occurs.

Turning to the brands.

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

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

We started a fund named after Hank guarantee the with $1 billion for the brands plus $1 million.

For a major league baseball and the Major League Baseball players Association to help grow diversity in baseball.

We are excited about our enhanced 2021 roster of coming off of a winning the at.

At least for our third straight season.

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 for a great framework coming off of 2020, NFL MVP a cool.

The Albion and more of our hunger.

The start.

Recently on.

On Tuesday, and our first strength spring training game is the Sunday, we expect fans to be a cabinets at 25% capacity.

Turning back to the a home plugged a three ballpark office tower.

We are near completion of 70% leased.

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 of true it this year.

We do expect to have fans in the advanced but not yet share of the peak heating 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.

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

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

Thanks, Greg and good morning, everyone.

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

The fourth quarter, we issued $920 million of live nation of exchangeable bonds and amended our one nation margin volume.

Mark Amendment.

Decreasing the share of underlying loans of $53 7 million for $9 million.

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

Inclusive of this additional margin loan draw a 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 Siriusxm.

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

Note that approximately a $150 million of our cash will be used in 2021 to settle the call spread between the Formula One group and the Liberty Sirius XM group and to repay our $2 two 5% live nation exchangeable bonds.

The values based on estimates of the fair value for the fair value of liabilities in Europe.

As of February of 'twenty, five 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 addition cost per upheld a formula one.

Valued at 370 $471 million a year round we.

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

The 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.

And the total and total of Formula One group attributed principal amount of debt was three 6%, which includes $2 $9 billion debt at <unk>.

The <unk> 727, a line of the corporate level.

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

At quarter end branch group had attributed cash and liquid investments of restricted cash of a $185 million and attributed principal amount of debt of $674 million.

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

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

Thank you Brian.

The first of all of the none of it to the former one.

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

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

<unk> was a challenge for everyone around the globe and everybody's all of the support felt the impact of the debt.

One of my one delivered what many thought was impossible instead of the Lakers calendar delivered safely and with huge enthusiasm from our plants.

72% zinc one is the approval of a path to use <unk>.

The 8% bogey. That's one is in good hands on the Liberty media.

71% rate they have a satisfaction with being in that one fan of eight or a hype.

Furthermore, funds believe Puma, one handled safely the anybody well during the global pandemic with 90%, believing the seek the measures put in place to allow rates as Google a head have been a handle well, 81% believe in F. One thats communicate the well with tens of humans the shut down the 73% believe and that's why.

That's a handbook the absence of fans of the rates as well and 88% feeling positive about the commander in 2000.

We all continue to love the gave the challenge of COVID-19 of this year, however that would not preclude us.

Alright, and opportunities we see in front of us.

Chart number one the drivers of the sense of the last one the grid.

At present, the soul and all of the box a bit of the sport.

A level of talent, we have today of the grade is one of the highest one of the history and we should celebrate that.

Number two.

Delivering an incredible product the <unk>.

Nathan its competition and action on the track, including plenty of three races. This year.

The three enhancing the long term prospect of sport and shooting at the attractive business model for all participants and attracted a new protests, but the number for remaining committed to our action through our release is one platform focused on sustainability diversity and inclusion and community.

So it's like the 2020, we were extremely proud to complete the successful <unk> received.

The last few races growth some new places to podium, including the psyche of GP. We saw sales you bet as convenient as opposed to the win alongside of that's about a quarter of lost tool at the same time in the same rates, we were relieved to see relevant growth John walk away from a theory crash.

Some of them to a man the.

The support teams on the track and improve safety measure in the sport.

The stop and secured the window of our last where I'm, putting up the derby, which capped a very successful season cold weather boot, who placed second in the constructor stenting.

The financial flows clearly we were impacted by COVID-19, but we're getting a collaboration with our partners to mitigate these impacts.

Due to the reduced number of races duration of the season that almost no fan attendance on the Suprisingly primary revenue declining a little cathedrals. However, we work with outlook for a moment the extent conflicts where a mutually agreed the work with certain sponsor for the theft selected writing for future years, we of course these the agreement.

The the spirit of partnership and largely isolated the old culture of the impact 2020 the.

Great of collaboration together with the ongoing symbols of all accounts leave us well positioned with all of a material commercial department.

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 of the second fastest growing major sport leaking total followers across the full of major social class, a but I had the major sports such as the NFL NBA PGA two MW.

Absolutely we.

We have seen the fastest growth in the digital engagement compared to all of a major support within the 19, 9% decrease of 2020.

Oh, the TV our average all of this for Grumpy was $87 4 million very marginally down on 2019, but still higher than the average over the 2018.

Compared to 72 other major sports with an international footprint that the excreta speeds decline it doesn't 'twenty due to the pandemic.

We plan to engage more sales in 2021, and we have set for an exciting 23 races calendar. This includes the addition of Saudi Arabia and much anticipated race in net doesn't evidence.

We live by the get the challenge of the pump, but are pleased with how we have already been working with our partners. We were able to the stead, Australia makes it into the year and announced the Retold a V more than 40 miles of the schedule.

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

We'd love to welcome first back on the track a will be working with the local organizes a government on that approach.

We're also grateful for the of course made by the government to allow a formula one to continue to travel to our other events during the time of a global current time.

All of a highly robust safety procedure, a proven we can travel and rates safely. Furthermore, we added by the way the race weekend with a proposal to try a new type of these clean trades, Paul some of the races. In 2021, the result of which would the remind the grades for the main events on Sunday the supposed supported by the themes of Brinci.

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 unexciting the season with loose some of the limits say despite the for the unique and he started April a championship, we hope to see for Raleigh, we that all of that he's putting the sport.

They have played back and I'm excited for all of the New places in the lines up on the grid for the most.

Of the season, we were wondering what a central patents would find a job of seats and we cant wait for seeking pad up with Max of its top of the.

The cloud of wet spectacular 2020 season finishes for the construction of Stephanie we'll see there'll be cash flow in London noted line up together.

We welcome Aston Martin and iconic brand, we do not see them of the champions for the best embedded at the end of the wheel. We also welcomed a a total number of loans so to a rename the alpine team he's doing well by the way. Following these rates in the accident and looking forward to see him of the start of the season and the rate and of course, the world will be watching the.

The seasonal mix you might get a pass.

Last year was momentous fulfillment of a one signing the new Concorde agreement and reaching agreement on the introduction of a coast GAAP taking effect the issued in 2021.

The next major we're able to cover a relates to the to the power of usually thought of engine the demonstration of a collaboration the FBI.

<unk> put them in a warm and the teams devoted to fleets probably end of development from the start of 2022.

High level. The working group has been established we think who's probably the manufacturer and food supplier as.

We looked at the next generation of the public units for 2025, the key objective of our carbon neutrality truly sustainable two of hybrid power unit significant cost reduction and of course, a slack to the new power unit manufacturers, we believe that the sustainable through the the hybrid engine will.

A very attracted all per for the Oems and their portfolio and provides another solution to be able to most of the they've got a organization that I have a across the world I feel very positive about this probably in the data and have already had very productive conversations with existing and potential Oems about the direction for one of these moving.

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

Average Corp.

In the coming weeks I wouldn't meet the with all of the drivers to discuss with them. Our we had a says we're on plans for the Sia. The deal included the rollout of our apprenticeship eastern the shipments Congress, you've been able to support for the I'm. The represent the books and very importantly, got heroes role models and champions of drill risks and other sport that is price.

Fans around the world.

We are looking forward to seize them free of drive to survive hit the nationally for March 19.

Once again captured all of the Dragons jewelry lines of 2020 and Theres No question Betsy This computer the new parts of the sport.

I can't Express my excitement for all of the opportunities approval. One the 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, but range on March 28, and with that once again. Thank the so much of it certainly open to you great. Thank you.

Thanks, Brian Thanks Stefano.

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

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

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 for us.

Greg obviously, the 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 of that moment debt.

Given the flow through will be a pretty small.

I think the dividends will be tax free both of that.

Is there an expectation that we should assume debt will shift more towards dividends over buybacks for a week.

You're on a path to sort of taking the company private and are there any obstacles sort of on that that we've done like the squeeze out a requirement of 90% and anything you can share on the side of what happens for the capital equity capital structure sort of post.

The 80% level and second of all its ethanol a welcome.

I just wanted to sort of get you a perspective.

In a.

Mentioned in the press, suggesting that you're looking for more quality over quantity in terms of the races, and obviously you're talking about it's been great, but you really think you'd need to change the format of the race weekend a uniquely.

Pay practices and making you the biggest tactical can you just talk about what you really think of the opposite.

To make the we can think of a event a booklet. Thank you.

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

First of all of 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 the dividend we at Liberty Media Liberty series compared to where we once were but it's really not that they can tell while we're looking at the the.

No the discount to.

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

We were running more like in the middle of 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.

Exclusion. So you know I don't think the huge thumb on the scale for Liberty, we a marginally more for.

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 of did we get the 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 kind.

The directors will have a voice about maturing debt the minorities and price appropriately protected.

Okay. That's my go to to answer to the question with regard to the format on the on the won't be a thinking and to improve income up show first of all of that would you say that that would a objective is a try to offer.

So the people that the come into the event to the people the other watching TV for the people that are really sounds a pool of lump sum somebody that he's excited so the idea that we have share then I think that the we have received a great feedback from a everyone. In the sport is that the we will try to figure out something that would give us a quantified on Friday south of does pinch waist.

Determine the the grid the order for the Sunday rates, so that would give the a thrill of a great. We can't that would be beneficial to all of the parking votes and this is something that we have the same then with the with the with the themes of the airplane. The next few weeks you know the two presented the final for months before the top of the seasoning of the range, but that's the aim of what we have worked with true.

To do this year in that respect.

Okay. Thanks, so much growth.

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

Alright, Thanks for taking the question welcome Toronto.

Can you discuss the free.

Green Zone 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 engine goals in line 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 the what is important to say that the visa idea of prison one of it in the bumps is connected to the new business sustainable approach that for one of his stake you know we will have taken of the shoe with the cost of cats that is related to a certain part of the cost of mentioned the theme. The other part of it was a non.

But a very important was how we can capture the controls the investment of course as in the normal business on the power unit the floor by associates of the fact that we would anticipate that the end of the spending newmont a lease for a new engine. We were thinking of how we can capture the attention of potentially manufacture but also.

Making sure that the ones that I spoke to the yard so that's in the future. So we do believe by being the hybrid in the future is a the exact position that will allow all of the manufacturers who have an access to a deep for the portfolio towards the electrification for.

The normal business. So the Florida, I think that most of the of putting in place in that respect hadn't carbon neutrality fully sustainable fuels all of the center and beat up but gave us a really great position instead of a package in terms of being always at the pinnacle of the technology of advanced research and Puma, a line and making sure that the everyone can benefit.

On visa activity also to have a a sort of a wrote the relevancy extra the activities that can be beneficial to all deal to most of the money factor and by doing that we're going to have a win win situation a lot of attention of probably the only thing a different way of all of the bean electric a.

Having the cost control under under the control and of course being a a light without what effect it will be sustainable for the future. So this out of the base of thinking that the we're taking when we decided to go and follow the stock.

Okay, and then I believe there's a number of ways promotion contracts expiring at the end of the tier I think the Singapore and was just wondering how you're thinking about Epsilon and Timmins region versus maybe of adding new way for us and other flyway markets I think you've mentioned in South Africa recently, and then with regard to the Vietnam GP is there any update you can provide.

Items on whether we might see that break at some point in the future.

Well, yeah, I mean for sure we are in a great moment because of the <unk>.

Fight the pandemic, we are receiving an incredible number of requests bye bye bye that shows that the F. One of the sense of beef that is not totally from the organized drove the over all around the world, but also from the motorsport community, but for our strategic plan is a to the side first of all of what is the right. They mentioned in terms of rate.

In the year the the comfort that you are mentioning the out of expiring, but said that out of a discussion of ongoing because the ones that the weather a considering that a really important and there is a lot of interest to progress in and keep them. A you know also in the future a we.

Confirmed.

That's a U S. A is very important and strategic markets for us and the.

We have a b a and to add another race in the U S. A we have already great parked in the most of them, but we ought to look in the for other solution debt.

It would be very important for us.

What I can see with Vietnam for whatever reason the happened you see we didn't have the race, but for sure that is a matter for at least in general that is very important for this the piece of growth although of a business in the future and for sure. That's a matter where are we going to exploit the other opportunities for the future.

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

We do not have an unusual number of promoter contracts expiring this year, a pretty much in any year, we have a portfolio for a certain number of 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 of had been behind.

Thank you.

Our next question comes from Ben Swinburne of Morgan Stanley.

Yes.

Thanks, Good morning, guys I.

I wanted to ask both Stefano and 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.

Of that have happened are happening have gone backwards, you know EPL, a the Bundesliga and at least the press suggests Syria may.

It may roll back.

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

I think the market has gotten you know.

Even more complicated the more challenging than it was a couple of years ago.

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

Okay, I mean, a in my opinion of the wish you a living today is for sure the interest until one side, but very very good about the other I mean, what's the can see that as you know on our business model the debt.

The broadcaster partners out of a hugely important for us, but we can see a very good opportunity to extend the end explored beat for the most of those two as I said to be complementary platforms and provide the data connection to the fan base both of the OTT World the thesis still a.

So in the area that we will for sure give a night a very important the night for the future, but the so the other day do believe that the if you are able to attack that is we are doing this.

The sport you know the commercial accounts, because they've got a she's there and we need to make sure that the the pool, we have the shape it up for the future give the context to make sure that is the livable for defense and that's why we have a lot of activity connected to make sure. The first of all of course, the they'll lose the traditional and a very religious fans, but we need to speak.

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

I agree with the Stefanos comments, but I had a couple of more if I could then for.

You know we've done a lot over the last few years. Thank you Chase and now thank Stefano to try and build a fan interest in fan excitement and that's better on track competition. That's a 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 the server.

Volume all of those building fan interest.

Obviously, the esports component as well.

As an important component when you obviously Gulf of renewal of 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 of your product.

Okay deal and it was largely because there were several theaters highly interested in getting a product I do feel it's definitely a notes we have a relative value you've seen declines in some of the other higher cost European alternatives, but if you look on any kind of basis about what the cost per eye ball cost per <unk>.

Our etc.

The point looks like a relative value.

And I think a sign of bandwidth 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 of live sports look so expensive maybe not quite as much when scripted continue to rise.

So I'm excited about <unk> prospects, but above all we would benefit from increased competition, which is a potentially some of the new digital players entering in the 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 a U S rights of the brand.

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

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 grades a contracts of 27.

The first and secondly, we have a good contract of a faraway not the highest bulk.

Well below somebody like the Dodgers, but in contrast, we have the largest broadband household audience. So the brand type of a largest territory with 12 million broadband households, sort of the gray you look at digital a targeted some of the like we are probably in the best shape.

Compared to many a benefit as new.

Alternatives to ride in the bundle potentially a weekend.

So tell me exactly the luck in the end of at least this a series of thank you. Thanks for thanks.

[laughter].

Our next question comes from Bryan Kraft of Deutsche Bank.

Hi, good morning.

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.

There's obviously a lot of.

Focus in the market by investors on how quickly.

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

Back half of 'twenty, one looks normal R 22 looks normal so would just love to get your thoughts 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 of just given the experience with the pandemic or are you still comfortable with that thank you.

So I'll start on the.

The opening.

It's certainly not binary.

Binary in a lot of ways because.

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

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

'twenty and 'twenty, one and then fast 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 where not necessarily kind of six zero to one contract it will be somewhere potentially in between the one.

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 is is a formula one.

I think again not binary.

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

I mentioned already the GA is relatively open.

We will be in far better shape from the.

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

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

Rules of authorities.

So the expectation is we will have increasing numbers of 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 or a vulnerable or affected by shutdowns.

<unk>.

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

Ah I think formula one in particular is preparing for a.

A.

Our balance sheet that is.

Invincible the whenever it comes and we're fully supportive of that the.

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

A.

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

A.

So that's kind of a you know that's probably a somewhat of a non answer Brian because we certainly are in 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 a change of pace that we would like and I think all three of those businesses are well prepared.

And that sort of trash the balance sheet question.

Think of.

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

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

The Formula one balance sheet is very very strong I think the operating levels that we have out of 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 of a flawed level.

Quite strong so I'm not really worried about the balance sheet.

Great. Thanks for the just the answer your question real quick on the leverage target a 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 of the 2022 and when we bought the business. It had debt approaching at eight times leverage and we substantially deleverage it not only true cash operations generated but we did have a primary equity issuance as well so both of those.

The reduced the leverage even prior to the pandemic.

Got it okay. Thank you thanks for the both appreciate it.

Thanks.

Our next question comes from David Beckel of Fernberg capital.

It makes a lot of for the question.

Sort of piggybacking on the.

Commentary about reopening I was wondering if you could.

Help us think about revenue recognition for the promotion side really all of the revenue streams under of 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 sort of a 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.

The affect earnings or EBITDA of one this year, specifically, maybe if you could frame it more in reference of 2019 level of it.

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

In the current year.

So.

Al I think promotion will be still reduced in 'twenty.

21, certainly versus what we would have in a non pandemic here, we will have restricted of 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 off of the air.

Floating around but also because that's weird.

And unless you do.

So how much will be it'll definitely be.

Packet the amount for which we will see.

And.

Going forward we.

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

The increased profitability, we have the opportunity to take back some of what a.

Historically F. One earned a 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 the pandemic I'm out of the confidence 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 Stefan a would you add anything.

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

You know a.

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

The debt.

That's the way both from the commercial point of view and also from the <unk> perspective to be part of this the incredible championship.

Alright, Thanks Bill.

Thank you.

The next question today comes from David Joyce of vaccines.

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

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

Sort of comparable the 20th 19 and grossing up for a step ups for escalators a number of events.

And then secondly on the briefs with the.

The Sinclair are a cent agreements.

And the 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 sort of play into your.

The economics and look of the due for further a fan engagement.

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.

Yes.

A crystal ball about exactly how COVID-19 plays out, but our goal was to try it.

Take the pain in 'twenty to the degree that we rightly had to make concessions to our some of our broadcasters are in total as much as possible with the make that a 20 of that and bring 21 back to normal but that is our open our expectation.

But.

Covid could change out of just as a as a warning and on the.

Thinking about the R. S N a.

As I said, we have our contract runs of 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 make the.

The next they can do or want to do and other.

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

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

<unk>.

Whether they're new engagement models that help us for Sinclair that could be out of it we'll see again I'm not exactly sure what sort of a Sinclair thinks the rights are to do some of those things but.

That's a bit through the.

A terrific job.

And just a.

Finally of the Covid impacts for them.

Formula one.

Broad strokes, how should we think about those promotion and sponsorship contracts and the the the mix between fixed and variable components is there is there.

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

What I should think you'd look most of the.

We do not have triggers.

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

A.

A partner who has a large international airline doing a.

A 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 for 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.

Our next question comes from Jason Bazinet.

Okay.

Thanks, so much.

I guess, having the 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 the unencumbered some of the passive equity Stakes.

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

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

Well you know, we're in the Optionality and Jason, but I'll, let ann or in a relatively new treasurer answer.

With respect of the Siri margin loan a we didn't do the upsize, but we kept it because of the same billion shares collateralized in that loan as we had previously under the one point of three five so we're just maximizing our ability to access dollars.

With respect of line.

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

We repaid it and we had a substantial number of shares of all of your line net secured debt.

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

The.

Really took the amount of shares underlying that.

Something that's closer to a a realistic LTV for a bunch of them.

Okay I understand thank you.

Okay.

The next question comes from John Tinker of Gabelli.

Thank you.

Terrific numbers and the battery on the brakes.

Unfortunately, the things get a little losses, given most people focus on a do you have any.

The other considering any way highlighting the valuation of the net fee.

A property in a different way.

John when we have a great analyzed for like you writing up the value for it we don't need anyone of our come on that's a no.

I think youre right there is value in the battery it is impressive.

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

The one where people are willing to come in and it's open and doing well.

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

Thanks.

For the final question today comes from Matthew Harrigan of benchmark.

Oh, thank you.

Even though a formula one probably generates more data than any of the sport.

Concert with AWS of Intel and Qualcomm It was really under the vault under the answer on the machine with Bernie you got a lot of acceptance of universal occurring on a pretty now I think you've got a lot of loud too. Many of you have any more.

Angles, and all of the out and cameras and the races. The rest.

But could you called for about the potential there and how you keep it at the Gulf.

All of it looks like you've made some strides, but theres still a lot of the headroom in terms of what you could do on just on the TV thought of in the video game side. Thank you.

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

<unk>.

The net.

Bob in the World.

Where we have increased starting on the sort of 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 when the angle you won that really plays perfectly to the strength of those kind of digital players and different kind of straight linear.

So I think we are a sport.

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

Different experience and one that the fans and Taylor I think you can see that opportunity ahead of 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 the.

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 a proprietary so I think on both sides, that's a huge asset.

Thanks, Greg.

Thank you.

So with that operator, I think we're done thank you to our listening audience for your continued interest of 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. The thank you for your participation you may now disconnect.