Q1 2021 Liberty Media Corp Earnings Call
Ladies and gentlemen, thank you for standing by welcome to the Liberty Media Corporation 2020, Q1 earnings call joined.
During the presentation, all participants will be in a listen only mode and afterwards, we will conduct a question and answer session at that time. If you have a question. Please press star one and your telephone keypad.
As a reminder, this conference is being recorded.
And I would now like to turn the conference over to Courtney Chun Chief portfolio Officer. Please go ahead.
Thank you for.
For me 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 Thanks, and 95 actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned and Liberty media. Its most recent form 10-K, and 10-Q and Liberty media acquisitions forms S. One registration statement filed with the SEC.
These forward looking statements speak only as of the data for this call and Liberty media and Liberty Media acquisition expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward looking statement contained herein to reflect any change and liberty media or Liberty media acquisition corporations expectations with regard there to or any change.
And events conditions or circumstances on which any such statement is based on today's call. We will discuss certain non-GAAP financial for Liberty media, and Sirius XM, including adjusted OIBDA and adjusted EBITDA, the required definitions and reconciliations for Liberty media and Sirius XM schedules one through three can be found at the end of the earnings press release issued today.
Which is available on Liberty Media's website now I'd like to turn the call over to Greg Maffei, Liberty's President and CEO. Thank.
Thank you Courtney and good morning to all of you out there.
Today speaking on the call. Besides myself, we'll have formula one's president and CEO Stefano de Mint and Kelly.
And Liberty's, Chief accounting and principal financial Officer, Brian Wendling.
Beginning with Liberty Sirius XM, and we continued our share repurchase is purchasing $114 million of Cros.
<unk> and K shares from February through April.
Discount stubbornly remains and we repurchased at a look through price and <unk>.
Here are just over $4 per share.
We do expect to continue to take advantage of that stubborn discount opportunity.
Our ownership of Siriusxm as of April 26 stood at 77, 3%.
And looking at Sirius XM itself and they're off to a fast start this year with self paid sub growth.
And the growth of 83%.
While starts and the first quarter were the highest and the company's history and they recorded record low first quarter churn.
We're also experiencing rapid growth and off platform advertising revenue.
360, L and next generation platform is now and 2 million vehicles, providing valuable data and offering engaging features we.
Expect it will be about 25% of this year's installs.
We are now the largest digital AD platform and North America, reaching almost two thirds of online audio listeners.
We're also continuing at Sirius XM, our expansion and the podcast segment with our acquisition of 99% invisible.
And our content creation capabilities.
Turning to live nation.
You may have seen in today's earnings release for NAV concerts are back and and high demand for data and 2021. In fact, we have book twice as many shows in 'twenty one as we did in 19.
Brian and 2021, ACM entertain other years aren't going on tour and the Railbird Festival with headliner David Matthews band is another notable addition.
Following up on acquiring the majority stake and beaks, we've begun our ticket live platform and started equipping 60, plus concert venues to offer turnkey live streaming and <unk>.
Yes.
We continue to help artist and expand revenue and creative opportunities connecting them with more fans via EBIT and other means.
Looking at the Formula One group, we had phenomenal racing this season, and Stefano will outline a little bit more and a minute.
So I can see the battle between Lewis and Max it's going to be a very competitive you're also for third place and the constructive championships and lots of exciting racing.
The teams continue to execute well given the ongoing challenges from the pandemic.
Turkey will replace Canada and June showing that sustained demand to expand GPS.
And also extended our agreements with Canada and Japan.
Looking forward and the first we are looking for to the first spread qualifying race in July at Silverstone and there'll be two more of those during the rest of the season.
I have to survive.
Our programming on Netflix continues to grow and properly already and its third season and and.
It's also getting recognize and reward circuits, both in the U S and Canada.
And finally, we look forward to seeing all of you and Miami in 2022.
Turning to brace.
After a slow start for the season. Our record is just under 500, and we are close third and the and at least a game and a half out of first place.
And we were helped by sweeping and that's over the last three games raise.
Braves are number one and home runs this season and also number one and average attendance almost 16000 per game that is if you exclude Texas, which we'd be third including Texas.
Bryan Caronia was named nationally player per month for April Tableau standard ball and three pinch hit home runs and April the most by any Braves player and a calendar month for it and its franchise history and as of today, we expect to expand capacity.
100% of fans after opening the season at 33%.
Notably and partnership with Emory healthcare, the Braves are offering vaccine shots before and during games against Philly Vince.
And to get vaccinated those gains will receive two free tickets to future brands games as well.
And finally, the Braves looking for battery and kitchen crop is expected to occupy their office space and July and Papa John's later in the summer demand for remaining office space remains very strong and the aloft and omni hotels had high occupancy on Friday night, and Saturday Night games are the nights and March with several Scott.
Sellouts and game nights.
We continue to make good progress on Almac this back.
This back market has changed and the way we believe it to our benefit and some of the euphoria of Japan.
January and February has deflated.
Believe recent weakness and the pipe marketplace, well for Liberty and given our strong balance sheet, our capabilities with investors and the support that we have.
Finally, we wanted to share with you that we have recently published our SaaS B disclosure on our website as a part of our ongoing ESG efforts.
So with that I'd like to turn it over to Brian to discuss our financial results and a little more detail.
Thank you, Greg and good morning, everyone Liberty Sirius XM group had attributed cash restricted cash and liquid investments of approximately $1 billion, excluding $67 million of cash and restricted cash held at Sirius XM.
And as balances prior to paying the Formula One group $384 million to settle the live nation call spread and April.
The settlement of the live nation call spread was a non taxable transaction among the tracking stock groups.
We also have $1 1 billion of Undrawn margin loan capacity at the parent level.
No debt a portion of our cash will be used in 2021 to repay our 225% live nation exchangeable bonds based on the fair value of the bonds at quarter and the amount of cash used would be $514 million.
As of May six the value of the Sirius XM stock held by Liberty Sirius XM group was nearly $19 billion and the value of the live nation stock held was $5 billion.
We have $3 2 billion and principal amount of debt against these holdings.
Total Liberty Siriusxm group attributed principal amount of debt is $13 2 billion, which includes $9 billion of debt held directly at Sirius XM.
Formula One group had attributed cash and liquid investments of $1 4 billion a quarter and this excludes the $429 million of cash that's held directly at the other one opco.
Quarter and Formula One group received and the additional $384 million and we just discussed and proceeds related to the live nation call spread total Formula One group attributed principal amount of debt was $3 6 billion, which includes the $2 9 billion of debt held directly down and up one leaving $724 million at the corporate level.
And if one is $500 million revolver remains undrawn.
Please note that during the three months ended March 31, 'twenty. One F. One began reclassifying certain components previously reported and other revenue and the primary and up one revenue to better align with the way management currently evaluates the business.
Components reclassified and the primary F. One revenue.
Generally relate to Epsilon TV subscriptions certain half two and half three related fees broadcast origination and support fees and digital advertising among others.
Additional detail on this re class, including the impact.
For the year's ended 12, 31, 19 and 20 it can be found and schedule three to our earnings release, which will be posted on our website.
At quarter, and the Braves group had attributed cash and liquid investments and restricted cash of $218 million and attributed principal amount of debt of $670 million $676 million.
Liberty and our consolidated subsidiaries are in compliance with our debt covenants at quarter end.
And with that I'll turn it over to savanna to discuss formula one.
Thank you, Brian and good morning, and also for my side. So 2021 has begun with acute gender and Jim momentum and the past few weeks, we announced our second race and USC and Miami Gardens, with a huge and positive reaction from our fans and the teams and all our partners and.
And waste and U S. Starting in 2022 provides a great opportunity for our sport and will ensure we continue our strong focus and try and grow.
Last week, we announced that we would have thought that the 100 and meet the sprint qualifying for months a pretty races. In 2021, following 19 with support from all the teams.
<unk> will be exciting for all of our plants provide modem track action over last weekend and.
And our partners and the teams greater commercial opportunities.
One of the vendors for the new for months already reported a surge and peak I'd say follow the news that they would be hosting one of these events.
We have announced the three years extension of the Japanese Grand Prix.
And this has always been unimportant ways for Formula one and we cannot wait for the past achieve one day and one.
We have extended our partnership with the Canadian Grand Prix.
And welcome the new announced last week by Dr. Bell media.
And in them.
We have the two acquired the molecule base and maybe at least for molten paying rebates and group, which is a great news for the long term future and developing of the Mesa and Canada.
While the global situation and fluid due to the COVID-19 pandemic for one that's shown.
Has the ability to overcome the issue for Donuts and continues today safely.
Last week, we provide that needs to be the case, while we are not able to waste and kind of this year, we have secured debt replacement rates and Turkey at short notice. Many we have Nokia and use the number and they seem to Colombia for talking to people.
But it is very exciting to see the level of interest from both the new and historic location to host exemplary and this gives us possible option is required for 2071, but those are good opportunities for the future.
We have had very good conversation with all of our promoters and all of whom we expect day rates as the season to go ahead as planned and.
This week, we have had the confirmation that 1000 and fans will attend and getting Barcelona and steadily.
And I'm free and that multiple will welcome approximately 40% of the capacity for the grandstand and pulled the rates into the wintertime.
Alongside the business started the year off the track that AC on the track has been equally exciting and dramatic.
Our 22 races season, and body and had had three races to date, which with the close battles overtaking and the back closer together that in the recent for US. Although it has grown as mentioned with this bathroom for the championship, but now this could be a golden year for Formula one.
This season, and operating but did not disappoint with for stop and security proposition and it was a pleading race between Max and Luis that was only decides and the final laps.
And also strong showings by noise, and Paris, and the Japanese Yoki and you get to know that scored points in these first and that's why rates for household salary and it looks like yes, it probably just because he and I had.
The buzzword for the for first continuing to email and whatnot has an amazing stat off the line in the rain and carry through for the weighted.
Impressive give him and he's starting and third yeah and he didn't mean.
And eight central Paris and.
But no worries me that's for them is taking well defined and securities pulse and the bogey showing the continued strength of Macquarie.
Last week, and being Portugal, and the safest and adopt us certain challenge stronger book.
And as Lewis Hamilton clinched a hub for Victor and imports and now with both the stopping and Poland Lewis and I had long been stopping and check them. The startup delays. So the red Bull get passed and the phases of their habits and before the seven chapters and pull it all green and silver it takes them. Both these teammates both December stop it depletes victory.
Again shows that there is a real battle underway for Bcf tightened and we have the only the thing they received and.
The competition for the Thursday, social peers, and because Chuck just and.
And the cloud and is making the early pace, but daily themes and the mix had something to do and it is great to see Siddhartha Heath and he's tried to get.
The spectrum a formula one race, so Nathan with fans and engagement is very high to date, we have data for this phase two races for close to 24 principal markets. We monitor and these showed PD viewership growth over both 2020 in 2019, with particularly strength in Italy, the Netherlands, France, the U K, the U S and even Spain.
And the digital Trump's unique he was this for X one web and App have been up 77% on the people in place in 2010, and social engagement and also pleased with the third can meet any direction and both of the first two race week.
We continue to grow our social media following and reached $36 5 million after the immediate demand and the GP up from 75 million under the player yet Ed.
And it's one P D. Our OTT product and that's also stopped the second and strongly with the really peak concurrent viewers each race weekend out of around three times higher than the 2020 season average and engagement measured by the Nimbus deal with over the course of the weekend is that more than 60% over the last year.
We launched and update version of the App for the season.
And many additional features and include the high video quality and allows us to control the viewing experience and new version also makes it easier to find posted in other collection, which includes over 2000 hours of footage and power virtual dancing around peak and the last 50 years, along with our latest serious debt to change and the dream and faulting.
And he is now available and 188 territories with the people that want to deploy if they end up with an 85.
And three of drive to survive the Booth and March 19, and continues to build and mass global popularity for the sport, reaching number one and that mix and 27 beat for the country and also globally.
And Oh utmost daily basis, we here and there.
About how this show was broken into new non physical plants and it was great to the diesel and the 2020 season and seen the back story of the viral D. O mainly drivers changes I do highly recommend episode nine which is a terrifying exhilarating and expiring. This show was nominated for a sport and for us.
And the city is sports documentary and made the short list and the momentum in aggregate for the UK broadcast awards.
And then into the season, we have had numerous sponsorship announcements we were pleased with new over and build a partnership with DHL and other.
Relationship, which now spans across several vacates. The extent after she will include enhanced his involvement and that's why and esports EBIT and a pleasant and I'll ask one digital channels as efficient part wasn't zoom and I'd say this is for Maarten. Other seats got provided and salary thing for the official dose for them and work. In addition, we announced.
He advisors and drive culture official supplier and welcome global citizen and charity partner for our what we raised is one initiative.
We continue to engage and fast esport and had the very successful series of visual Grand Prix during the off season.
Current drivers along with pool must dogs and future prospects competing to win a share of the $100000 priced phones and their challenges.
For the convenience for to improve diversity and inclusion and formula one as part of our weird I suppose well and the initiatives that allows for female the only qualification routes for the F Y E sports and see this broke chat issue. This.
And this is our first female only competition and we hope it will encourage more drivers from the passionate and talented teammates and rates and community with the goal of becoming the first ever see and they drive up to be signed by and official F. One esports secrecy and.
Clothing Formula one is off to a strong start in 2020 book building off the foundation put in place. The last few years the ecosystem and these absolutely strong and the competition and the check is clearly I want to thank all the dedicated employees of Formula One full day continuous diligence and hard work and I Hope you will watch.
And the Spanish Grand Prix this weekend.
And I'll, let Tony as it pulled back to over to you Greg. Thank you very much.
Thank you Stefano and thank you Brian.
And to the listening audience. We appreciate your continued interest and Liberty media and.
And last the health and safety.
And with that operator, we will open it up for questions.
Yeah.
Thank you.
And if you would like to ask a question again. Please press star one on your telephone keypad, if you're using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment again that is star one to ask a question.
So we will now take our first question from Jeff aspect of this and the research.
Go ahead and your line is open.
Good morning, I had one on Siri and one on a flow middle one.
Greg It at 77 point for your ownership stake and Siri.
And all else being equal, you're probably gonna crossover to 80, plus and the third quarter.
Dividends go tax free just wanted to get your latest thoughts and whether series going to raise your dividend materially or are you happy with the status quo and letting your buyback sort of continuing to write higher and then on S work just.
Just was wondering about the color on how the $145 million cost cap is going relative to your expectations. Thanks.
Paul I'll take the theory and I'll, let Stefano speak to the cost cap and sorry look we I think that.
For pace may be just slightly aggressive Jeff I think it might be it depends on the stock price and where series buying but it might be and Q4.
And then one of those two quarters, we're likely to pass any.
Obviously any dividend policies that are put.
And it will be decided by the full board there but.
We have lots of alternatives and which we could.
Either.
Take advantage of those dividends to continue to go after the discount at Syria.
And Alex XM, rather of Siri to increase the dividend or potentially.
And of that buyback hold ourselves above 80 and use the capital.
And to buyback our own stock. So there are really multiple ways to get the same result, which is we are going after the discount and whether it's their through.
And do their dividend, increasing or selling and the buyback and we will be attacking the discount.
Definitely let me turn it to you about the cost cap.
Thank you, Greg and Jeff as you know cash cathodes being one of the most important and significant thing that's for Washington D C.
And the fact, not only because of the savings that the teams will make in the future, but also in the change of mentality.
<unk> team has to apply with the organization to make sure that they can really be effective with a different line of expenditure and this is just the first step into a new way of medical support and Formula One and I think that for you know he facing if I see what is happening around the world that everybody's focus just for them to revenue side I think for one has just stopped at the properties.
And all the other way around let's call. It should have and is crucial but now we have to just tackle that so starting with Costco and we do not take all the coast guard and other areas that did not close the and this moment that at the edge and for the future, but we have pretty short, but he's out also the problems of the team because that's been a huge step and making sure that the formula for sustainable products.
Alright, thank you.
Yes.
Thank you and you will now take our next question from Dan at Morgan Stanley.
Please go ahead your line is open.
Yeah.
Hi, good morning.
Greg just on the cash balance at Liberty Formula One and I think it's 1 billion eight and.
And all signs point to a strong year ahead I'm just wondering at what point does that day.
Some excess cash in the eyes of Liberty.
And then Stefano I have a couple of questions around driver, especially I wondering if you can humor humor me a bit.
And have gotten questions from from investors around the retirement of Lewis Hamilton, and battle, and what that might mean to the sport and and sort of the business I know, they're coming back and they come back for next year at least but as you think about that and and sort of the outsized impact. They have on the sport you know how do you how would you suggest we think about it if it matters and how.
And you manage that.
And then I was curious moving Miami, obviously huge.
Opportunity and and the whole U S market as well is and American driver important and F. One in terms of driving popularity here and the U S and do you have any expectations that we might see one anytime soon thank you.
So on the cash at Formula one really at the hold co level one level.
I think a couple of things and are first of all we put that cash and place to ensure.
The health of the whole ecosystem not only the formula one.
Business that we own but really the teams and to ensure that we have liquidity and we didn't use some of that liquidity for some teams during.
During the pandemic, we still have.
Uncertainty about exactly what our revenues will be in 2021, you heard already we've had to cancel for example, Turkey Canada.
Canada, and Turkey, and we are getting paid for that but those are a way reduced levels compared to what we would get if we had full fans. So we have a fairly large.
Contingency and our own budgeting for the potential that we will not get the kind of revenues that we hope and therefore that cash is useful you may also know that we committed and the forward purchase agreement with Almac. This back and at least $250 million would go towards the pipe and any transaction if we were to complete.
So I think we're gonna so see potential for opportunities.
And that market that could be attractive to us as the spec market gets more turbulent that place to way as I mentioned earlier, our strength and we wait and they want to put some of the cash and that but as the year progresses, and we get more certainty about promoter revenue we.
We will look at what we do with that cash and how to utilize it and.
And what.
What is the most epic efficacious way to deliver value to our shareholders.
But if I may know, Greg and then the question related to the drug and we did have to.
At least for short and shallow and there's a great batch and he's doing an incredible job on the sports and side and some of image. He was able to build for my one and other and as Brad and I will tell you specifically related to for more one but total one itself as strong or stronger and that you know drivers changes you know I'd always in a place where they are.
And one day. They may every time I don't know, what we do and we are talking with them, but of course now it's focus on these.
Actual season is fully boosted to make sure that will be the older drivers, but they are going to win the eight titles and.
And the history from day one.
And but you know for one is solid and robust and for sure. What other believed that the seasonal and Louise you know for them a wildly and react they will move forward for the the good news is that we.
Louis as we all hope wouldn't stay.
And incredible season, and front and with the new cars and with a new challenge and for sure. This will maybe that interest and all of them.
Decided and it's a way around I mean, the good news is that and for one we have so many good draw. This debate that's at least the challenge of the charge will be even stronger and therefore of course, what other uses of the cheese and the lowest little respect, but still more on these really solid and strong with regards to Miami with the Americans drive. This it is important and be answered.
For me, it's very clear these yes.
We have we are working with teams that play to understand what is really the possibility for nomadic and drive it to come and so the attention for one team and the short term debt.
It could come and I don't see that as being very pragmatic and realistic coming and the next two three years, maybe after yes, I know about the team's watching other good drivers that they're ready would be a big boost for a poor for the American tax because as we know you know Facebook drivers you know the book.
And to jazz and passion that people want to see these guys and and therefore, the hope that we had and that's very very shortly as well and a mood and drive is competing against all the other diploma and chocolate.
Thank you.
Thank you so and then I will take our next question from Brian at Deutsche Bank.
Please go ahead good morning, Hi, Thank you good morning.
Would you be willing to size the onetime settlement impact on the first quarter of Formula One revenue for US and then separately, it's great to see Miami on the calendar next year I know its something <unk> been working on for three or four years.
And what can you tell us about your plans for the event and maybe contrast, it to Austin and how significant do you think it will be for growing the sport and the U S and related to that you broadcast contract with ESPN is up for renewal I believe after next season. So how are you thinking about the opportunity with ESPN and given their focus on ESPN plus.
It's now Miami and the calendar and also just the general progress you've made so far and growing and the U S. Thanks.
So I'll, let Brian talk about one time events and the first quarter revenue and then.
And Oh.
I want to weigh a little on ESPN and I'll, let Stefano as well for Brian start yeah as it relates to the settlement we can't comment on the specific details, but it did impact our results, but obviously when you look at the year over year results.
The fact that we had the other one race versus zero last year and the proportion of revenue recognition was the material driver of that but we can't comment on the specific zone.
And.
On the issue of the U S and ESPN look when we put that up.
Among the various broadcasters and alternatives.
A little over a year ago.
And chase.
And I was in total agreement had the belief that we were going to grow and popularity and the U S and our hand would be strengthened.
Due to both now and doing Miami and doing drive to survive and all the other things that we have going on from fan festivals to digital engagement. All of those are building, our interest and the U S and as Stefano noted and many groups that heretofore have not been interested I have people coming up to me, who are saying I'm upset.
With Formula one because of drive to survive.
Who were not our typical audience.
Women are teenagers many different kinds of audiences that are expanding which is great. When we did that we took a shorter deal with ESPN that had a broader set of exposure for us in terms of their eyeballs.
But it was not the highest.
The current deal we can get and it was not the longest deal we could get and in fact it was the opposite it was the least amount of money. The most amount of eyeballs and a short period of time, because our belief was that we would have a much stronger hand, as we went forward among the various bidders I think that is a good bet. It's one that we are winning and all the reasons we.
And before I think we will have a much.
<unk> strengthened when we go to renew and against that ESPN and other alternatives Stefan and what might you add yeah.
Absolutely and I think that's you know the good news is that we are talking about some other races, and U S Miami Beach and culture with the geologic.
The weighted if we got a structure that the show around it and the incredible names that you know and just a couple of weeks up there a little announcement day that the attention where they've got to do that and it's really massive and and the expectation of getting the leather doesn't work and this is the reason why we are building.
And see this all communications and let's see there's a book.
Broken and Timothy <unk>.
Asia with the medical community, because we want to maximize everything else other than that.
I cannot keep it and if it had been for example, one thing that people would be fantastic, we garner share.
They do Miami gardens, and with the Miami Dolphins the race at multiple because they you know they want to start leaving the atmosphere and this will provide us the right platform in order to be ready to make.
So the the value that we're going to generate for them you actually would be even higher and that's really the fundamentals that you would think you'd be I and the fact that we've got I have to race and United States.
Great. Thank you so much.
Yeah.
Thank you so when I tell you our next question from Vijay <unk> Evercore.
Please go ahead.
Hi, good morning, So other couple questions on Formula one.
Primarily probably for Stefano.
So what do you see thinking about rates promotions. This year, obviously, you have 22 races, but with or without fans and different proportions of fan how should we think about that are you getting for promoter revenue.
Letting some of it based on fan or getting non and hosted and the race and any any sort of thought because that's sort of the go to the segment that has the most variability.
And then.
We've been seeing a lot more press releases coming out on sponsorship on Formula One will be a new sponsorship had is there a resurgence on that or is that a sort of more like a formalized process and letting us know and what's going on.
Because that seems to be probably one of the biggest growth drivers for the business long term and finally, one for or Greg, maybe it's a little premature but for.
Probably the one that becomes an ATB and Jan next year.
And you'll have grades and ATB.
Any thoughts on what structurally you could do or would like to do if you can share. Thanks.
And thank you Vijay I mean, the first question related to the to the fact that of course, we have and situations that is evolving with regards to the debt.
And then this is other people are tracked and Greg those other dimension.
But we need to monitor the race by race case by case of course, the movie going and there hasn't been more of a it's likely that the opening up.
For the for the fans we note that the direct effect on debt I think as you know, but we are also confident but we cannot get into the data rather and we don't expect the day attendees of the people that has no influence on the book would be.
The effect and so it's really a mixed situation, but we need to evolve and manage it I didn't get the question with regard to the sponsorship VJ can you repeat that for me. Please.
Yes, definitely and they've been announcements zoom and bunch of other answers you've announced more recently and I'm just kind of understand is there sort of a resurgence and sponsorship in formula one more recently or is it sort of just better disclosure for us.
And just to show Yeah, and just to show. The fact that you think that is the two for one is getting back again at the level that we really believe is the right. One so the fact that despite the pandemic situation, but other big companies that are willing to engage and and be our Portland is a great sign.
And of Trust and what we're building in the future and we need to expect.
This approach even stronger and the future.
And as far as structural.
The changes we have no play and our intent today.
Obviously, having a second ATB today, the only ATB, we have at Liberty media is the Braves, having a second ATB gives us flexibility if we want to create other spins are but we have no plans today.
Alright, thanks, so much.
Thank you for you and I would take our next question from David ask J P. Morgan.
Please go ahead.
Hi, Thank you.
And Eric one we've seen Disney and moved to shut down and star sports channels and <unk>.
For the Asia, just kind of interested to know how this impacts for you first directly as I believe they carry the series, but at a higher level. How you think this pivot to streaming will impact demand for sports content and some of those regions.
And then maybe just separately and Stefan.
And as you noted viewership seems to be and a nice uptick.
Through the race and so far would be interested to get your thoughts and how much you attribute this to the rebel Mercedes dynamic versus kind of the actions that you've taken off the track like drive the size like the social media outreach.
Well, if I may start for the cycle and David It's clear that that's about the show and so but the engagements and better and entertainment for the people. There is no doubt, but the thing is that there's one element. The other element is the fact that we really are engaging with more people that love it for more one and therefore, the fact that we are able to attract.
For other people to.
And a way of languages that were not used to.
For us before I think is also helping the fact of the viewership and engagement and in any case for them because they're about not only the TV and if there's been about that and social media platform and then the other element that OTT you show and that you know there is a lot of attention a lot of interest for sure.
And you know what is happening on the track is very very important that there's no doubt about it and this is for sure.
A good sign for us.
You know I I would.
I would totally agree.
But it definitely why don't you comment on the rest of it and then I'll add.
First part.
Sorry, Greg and the light went off and on my side.
Maybe you want to repeat your question because I don't think we cover sure Yeah sure. The question was about Disney and they're moved to shut down and Star Sports I think and parts of Asia. Just wondering how that empower you directly and then just your higher level thoughts on.
And with the streaming and kind of what that means for demand.
Stefan and why don't you say, commenting and then I'll give you I may have some views. Thank you yes.
Yes, absolutely. Thank you gave I mean, David we have of course as you know agreement in place. So we are expecting you know for that to be totally and postal. So we don't see that there's a problem, we see actually a big opportunity for the growth of the Tvs and the engagement and Seeger and <unk> talked to the wall to find other solutions.
And we are working on of course, but on the on the share pardon I shouldn't be there with respect to anything that's happened.
So I think more broadly and you think about it you know.
More platforms is a positive for us and yes. They are the some of the legacy platforms may decline or even be eliminated but in general we're seeing a new platforms created that's an opportunity and just the way that you're.
Oh here and the United States when satellite came in and eventually when filed and other fiber alternatives came that create and upwards pressure on content costs.
Because of the bidding I think we will see the same opportunity and what we do worldwide at Formula one.
And as usual, we'll have a tradeoff on exposure, which for ATV offers against.
And in many cases higher short term rates for either over the top platforms and we're even more streaming platforms over there to me platforms like satellite for streaming platforms, and we will way our total dollars available.
Against the exposure that we get for things like generally promoter value and advertising and sponsorship so I'm not so worried about these.
Slower growth platforms being cut out by people like Disney and much more excited about the opportunity on the digital platforms, particularly as they gain scale.
Thank you.
Okay.
Thank you. So we will now take our next question from David Beckham, and I have Eric Berg.
Please go ahead and makes a lot of.
Great. Thanks I've got.
Two on F. One I just wanted to talk a little bit about the spring race format.
Maybe get a little bit of the thinking behind that and obviously adds incremental value to your partners, but more specifically as it relates to future economics do you expect this to add to the value you receive from your partners or is it more a part of just adding value to existing agreement.
And then secondarily on.
Going back to the U S market and with the TV deal and play and a few years and <unk>.
I'm sure you've paid attention to what Ww. He did with Peacock I'm wondering if there is a potential to sort of leverage the <unk> TB over the top platform and a way that can sort of augment.
The broader value of your U S broadcast and overall TV distribution rights.
Thank you David I mean with regard to the sprint sprint for month I think.
And it would be.
Beneficial to everyone and if I had to answer your straight away to the last part of the question of course, we expect to add more value.
First of all that is action that would be very very positive and some other type that would be a good idea because from Friday to Saturday to Sunday, there is something to talk about.
For a lot of action a lot of intensity that is something that of course. This will have a direct effect on the people that will attend to the race and this has been a.
And welcome by all Yoga and Azure and in a very positive your weight on top of it of course, that's something that we are offering to our media partners because we can't wait for new companies, we can generate other form of entertainment and in AD.
Our new for them at that hasn't been never deployed before and also for the partners that have the chance to and the privilege to be in the dream for two times sales and Saturday.
And what would be different of course, because day the center because it'd be the race and some of them. But this is something that we believe that they will have also an impact on the on this and I should point of view.
And on top of the AD and the excitement of what these rates and it's all about.
With regard to the market the TV deal and deleverage.
And related to all of our tools right. We believe that these will enable us to discussing the future ease and a different way of integrating our FTE and OTT.
OTT platform that is going very very well in the future and then for that will allow us to balance sheets for the fact that the market will be even cause I've seen other sports and the commitment that we will be very very big on our side to make sure that this will happen.
Got it if I could add to what Stefano said on that I think we certainly watch what Ww day with Peacock and I think it's.
Somewhat indicative for the longer term trend.
Very few sports I believe have enough content to run their own over the top service as their primary vehicle and there's just not enough content. If you look at WWE and they have tonnage.
Compared to us and so F. One TV is a great asset.
For our for.
Connectivity with fans and for our connectivity and particular with our most hardcore fans, but I don't believe it's a plants are our traditional broadcasters or other other over the top broadcasters, who are looking for a broader set of content and relationships. So I think we certainly watch that and it's consistent with our view and I do believe.
We'll see that kind of opportunity with larger digital platforms and F. One TV can be a part of the solution with them as you know.
Great. Thank you.
Thank you we will now take our next question from David Joyce with Barclays. Please go ahead.
Thank you two topics one is just another clarification on the promotion.
When you say it was worth the time does that mean it was just one promoter or there.
Are there any others lingering out there and was within the range of other typical promotion free.
And then secondly on sponsorship how should we think about the range of sponsorship types of contracts like how many.
Are based solely on the particular races versus you know the proportion of revenue that is really allocated across the season.
And are there any other types of new sponsorship structures. Thank you.
But I can I can do the promoter piece. It was one race and that's disclosed in our earnings release.
As it relates to the typical range of a promoter agreement and we have a wide range. So it falls within that range yes.
Yeah.
David with regard to the sponsorship for the range of course depends on the on debt of water.
The package that we have we have official partner and and.
We have other kind of relationship and all are related to really the rights that they gonna have a until we have little impact and just about that all consistent with the seasonal with the old and third championship and not related to the single event itself.
Yeah.
Alright, thank you.
Okay.
Yeah.
Thank you for so we will now take our next question from John asked Gabelli Your.
Your line is open. Please go ahead.
Hi, Thank you.
Switching gears.
Sports gambling as hot coffee.
So I think dropped kings swings and so on so what are the benefits you might see from Eros and with.
And per hour or Bally as it is now is there anything that could actually help you.
John.
A shot at that I think.
And those benefits are going to be secondary and not primary.
You'll have increased fan engagement there may be.
Georgia is soon to open it appears.
Gambling will become legal in the near term and Georgia. It is not today, but it has been on the ballot and it looks fairly favorably inclined and the next and the coming cycles.
I think that will provide us some marginal revenue opportunities there, but I don't view it as a huge revenue line for us directly I view and secondarily, the interest and if we and baseball MLB and capitalize on that more broadly I think it just continues to draw for fans not not clear that it is.
No revenue line and the P&L directly.
Yeah.
And just as a second quarter question on sports, you've you've probably seen some of the disruption and England.
For the fans became engaged and stuff about around the Super League Youre, saying.
Yeah, and just generally.
A fair amount of disruption that a lot of talk of P. E companies buying into series, a and nothing happening is that an area, where you might see some opportunities or is the fact that the soccer team can be relegated just makes it too risky.
No.
John we have looked at as many of those opportunities as we can possibly find we do think it is interesting we can debate what.
And what's going on and each of the various leagues and where they stand in terms of their cycles and unlikely broadcast revenue and other kinds of opportunities. We do look to our experience both at Formula One and the Braves and what we'd like to think we have done positively with the league and Formula one and what we'd like to think we've done positively around things like truest and a battery.
And think about how we can apply the skill sets that are inside liberty at various opportunities.
And we tried to sell that we have been a a good and long term strong owner.
Perhaps different than some of the other Americans have been perceived or how P. It's been perceived we haven't yet found the intersection of where somebody wants us and we want them, but we continue to look and I do think that disruption over there does create opportunity we have gone through we watch with Super League with interest because.
Before we were involved.
With Formula one there was certainly the talk of a breakaway and Formula one which did not come to pass and we feel very confident we understand breakaways very well and I think we've pretty much eliminated that opportunity or potential at formula one as a side note.
Thank you.
Thank you Sue and I will take our final question for today's conference from match U S. Benchmark. Please go ahead. Thank you.
Even apart from a Max for stop and literally banging wheels with book Lewis Hamilton and always seemed relatively quarters off track.
We have the most competitive seasons and so I think 2012 for your Ferrari is coming back and Macquarie and Lando Norris.
It's Sarah and I was just curious you've got a broad suite of changes coming next year and to make the competition on the track more competitive.
Just to give you on deposits.
And next year.
Even if this year and seemingly is proceeding and so strong right out of the gates and.
Do you have any and all be reassessed and heavily and reassess.
And at this or just <unk>.
And you need to roll on.
Well Matthew the changes and it's been already discussed the teams are already working on new cars and new regulation and you know the trading and as already left the station. So we are very pleased because we are convinced that this year and he's already a great season for next year with the changes that that's been the plan there will be another great opportunity.
Showcases what these formula one and terminals and <unk>.
And you always keeping the attention.
The center and therefore, there is no other things, but the checking and everything.
All of these days and they showed that the changes will be Matthew on the cars and they see it.
Hi, like COVID-19 and the possibility to have.
And I think it's like literally two or three drivers that even more and that's the objective.
Thanks stuff and they'll really revealing but yes.
And just look we're lucky this season's great.
The work that was done and the Cochrane agreement.
By Chase and Ross Brawn and others.
And we hope to only increase the competitive next year and we're very excited to Stefano noted about what's going on now and even more excited about what we can do in the coming years I think with that operator, we are done for the day. Thank you very much to all of you are listening out there for your interest and Liberty and.
And we look forward to speaking with you again next quarter if not sooner.
This concludes today's call and thank you for your participation you may now disconnect.
Yes.
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Yeah.
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