Q2 2022 Liberty Media Corp Earnings Call
Please standby.
Ladies and gentlemen, thank you for standing by welcome to the Liberty Media Corporation 2000.
2022, Q2 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 as a reminder, this conference is being recorded August 5th.
I'd now like to turn the conference over to Courtney Chun Chief portfolio Officer. Please go ahead.
Thank you.
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 and the most recent Form 10-K, and 10-Q are Liberty media acquisitions. Most recent Form 10-K, and 10-Q filed with.
The SEC. These forward looking statements speak only as of the date of this call and Liberty Media and Liberty Media acquisition expressly disclaim any obligation or undertaking to do so.
Terminate any updates or revisions to any forward looking statement contained herein to reflect any change in liberty media or Liberty media acquisition expectations with regard there to or any change in events conditions or circumstances on which any such statement is based on today's call. We will discuss certain non-GAAP financial measures for Liberty media and Siriusxm, including adjusted OIBDA.
And adjusted EBITDA, the required definitions and reconciliations for Liberty media and Sirius XM schedules, one and two can be found at the end of the earnings press release issued today, which is available on Liberty Media's website now I'll turn the call over to Greg to say Liberty's President and CEO .
Yeah.
Great.
Alright.
Good morning today on the call. Besides myself, we'll also have formula one's president and CEO Stefan will give them a Kelly Ann.
Liberty's, Chief accounting and principal financial Officer, Brian Wendling.
So, let's begin with Liberty Sirius, except where we received a 70 million dollar regular dividend from Syria, and the second quarter, which was tax free we also repurchased $93 million across the <unk> shares from May to July .
It looks through price on CRE of $2 88 per share.
We do understand the discount has widened and it is frustrating.
And while the decline of <unk> is in line with the overall market further widening of the discount has been very disappointing.
We still believe repurchases are attractive means to capture that discount, but it's becoming clear that not enough to collapse it on their own.
We are focused on this.
While not a fulsome list.
Potential actions, we might consider include.
Reducing debt at <unk> to enable a combination and are not overly levered CRE OSX.
Steps to better illuminate the value of our lives stake.
And other potential actions.
I would remind you at Liberty media in some of our various spun off entities, we have a long history of corporate actions to capture discount and these include structuring the GCI acquisition in such a way it was immediately an ATB.
The Directv RMT and subsequent sale to AT&T.
And the subsequent the separation of Liberty Expedia and subsequent merger with Expedia.
In summary, we have options and actions we have taken we have a history of doing so.
So let me try to Syria itself, which I believe is handling the market challenges well and maintaining their financial guidance. Despite a reduced sub guidance due to wait weeks or which has been well documented for reasons like chip supply issues.
They had robust financial results for the second quarter, including revenue up 4%.
Sure and steady at one 5%.
New and used car penetration is up to 84% and 51% respectively.
We also announced extensions with important auto maker partners, including Mazda and Mitsubishi.
We made continued progress on our connected.
TV platforms like Amazon fire, Android TV, LG and Roku.
We signed a new agreement to fully integrate.
They launched.
Sirius XM the audio experience on extending with Comcast with video to come.
And on demand music listening in the Sirius XM App is up 41% year over year, and that's partly driven by the addition of new unique and diverse content.
Overall sports listening is up in the App.
Our agreement to make Siri exclusive third party platform for NFL games is helpful.
And keeping the family, we also announced an extension with F. One to cover every race on the World Championship calendar.
Lastly, we're very excited about our continued work in podcasting Americans listen to audio up 9% last year podcast audio up 9% last year and our podcast platform business revenues were up 50%.
We also extended our agreement Comscore to release AI powered podcast audience targeting capabilities.
Somebody returned to live nation announced very strong results. It is clear why events are back on a global scale with yet another quarter of record results versus 2019, NOI is up 50% free cash flow was up 72%.
And that rose to $379 million.
Ticketmaster itself was up 86%.
And the transacted GTD was up 76% again over 2019.
Sponsorship AOI was up 81% over 2019, and important new clients, including Google AWS and Hulu.
We had the highest highest quarterly attendance ever over 33 million fans.
Our onsite fan spend growth.
Continues across all venues.
We have an outlook for a record 2022 with a $100 million concert tickets already sold fan attendance is up 13% and operated venues and almost starting new venues in the pipeline.
The 2023 artist pipeline is the largest we've ever had at this point in the year.
So exciting stuff turned.
Turning to Formula One group.
<unk> continued to see record attendance and viewership in the second quarter.
The Australia, Austria and Grand Prix was our second spread of that viewership was up 39% versus the 2021 Austrian qualifying.
We are also benefiting from the return of coverage on CCTV boosting our audience in China.
Similarly, we've had record in person attendance four races. This year have had over 300000 attendance with incredible demand for the Paddock club.
The Hungarian weekend attendance for example, with 290000 was the largest ticketed sporting event in history in Hungary.
So we've seen strong ticket sales in sell out demand for the rest of the year.
The calendar as well.
The new regulations.
Part of the Concorde agreement are succeeding and enable closer racing and demonstrably more overtaking.
We are continuing to pursue trail appraising work around sustainable drop in fuel and regenerative engine development and we think these will have implications across the entire transportation district.
Turning recently.
Our most recent work in Las Vegas, we completed the land purchase at the corporate level. We're excited about the potential for this property, we do expect to have year round Activations. This site.
The main paddock building, which is estimated to be 900 feet largely like the three football fields will be exciting and we're actively working with potential commercial partners to expand our opportunities there.
We are building out the <unk> team and Vegas across sales marketing race operations and more.
We're leveraging local expertise and talent as well, including the <unk> and our partners at live nation.
We're still working through the specifics on capacity.
But I'd note that our founding partners in Vegas, Caesars Wynn at MGM are seeing incredible demand.
And we haven't even announced a formal date.
We will obviously share more details on Vegas overtime.
While some of you were excited you don't have to wake up early for races over the summer break.
Here at Liberty I look forward to restarting formula one at Spa on August 28.
Turning to the Braves, they've been playing excellent baseball over the past couple of months.
As of today, we're just under 600.
A record for the season and since June 1st we have the best record in baseball.
Sad lots of them that's last night.
It's an exciting team and the world's Halo is still driving fancy choice Park.
Fraser tenants is up 23% compared to an already strong 2019 season, we've had 24 sellouts to the all star break and trending to roughly 50% sell out for the year.
Tickets parking concessions in concert the Roxy are all performing well.
We've had six all stars name this year most of the team since 2011 and double the amount from last year. We just signed an extension with US Riley a 10 year deal at $212 million the largest in franchise history. After outstanding performance by Austin This season, including Historic July .
Alex Anthophilous once again deserves credit for the moves he took to strengthen the team before the trade deadline.
We do remember how well it's worked out last year.
<unk> gross for the field and the <unk> picture.
Both insurance to our lineup.
Adding also bullpen capacity.
We want to congratulate our.
Snip.
Five hundred's career win after just thinking that's always last week.
And again, we encourage you to tune in to the met side.
Yeah.
We have nothing to report today on <unk>, but we do continue to review opportunities and look at the.
Environment was difficult prospects as an opportunity for us.
With that I'll turn it over to Brian for more on our financial results.
Thanks, Greg and good morning, everyone at quarter end Liberty Siriusxm group had attributed cash and liquid investments in liquid public debt and equity securities of approximately $368 million, which excludes $126 million of cash held directly at Sirius XM.
There was also $1 3 billion of Undrawn margin loan capacity at the parent level related to our Sirius XM and live nation margin levels.
As of August 4th the value of our Sirius XM stock held at Liberty Sirius XM Group was $21 5 billion and evaluate the value of the live nation stock was $6 8 billion.
$2 8 billion in principal amount of debt against these holdings.
Total Liberty Siriusxm group attributed principal amount of debt is $13 7 billion, which includes 10 billion of debt at Sirius XM.
Formula One group had attributed cash liquid investments and monetize public holdings of $1 1 billion at quarter end, which excludes $935 million of cash held directly at Formula one.
Formula One group.
Attributed principal amount of debt was $3 2 billion, which includes the $2 9 billion of debt at Formula One.
Leaving $306 million at the corporate level.
During the quarter, we repurchased 146 million face value of 1%, while cash convertible notes.
Due in 2023 for approximately $240 million.
Hiring 95 million underlying <unk> shares at an average price of $59 88.
F. One is $500 million revolver is undrawn and formula one leverage at the end of the quarter was three times.
As we discussed last quarter under the current Concorde agreement team payments and I will take the form of an entirely variable Prize fund, which is calculated with reference to a measure of F. Once adjusted EBIT rather than the adjusted EBITDA measure used in previous agreements such that the calculation now takes into account capex incurred by <unk>.
<unk> depreciation cost.
There is an immaterial difference today between formula one's adjusted EBIT and adjusted EBITDA for purposes of this calculation.
Note that our reported F. One depreciation and amort includes purchase accounting amortization related to the acquisition that is excluded for purposes of the price on calculations.
We've quantified it quantified this purchase accounting amortization in our earnings release to assist and calculations.
Also our formula one other half one revenue is running materially higher than the prior year up about $80 million in the second quarter and $130 million year to date compared to 2021.
Increased freight and hospitality income accounts for 98% of the quarter over quarter increase.
Note that the Paddock club didn't run until July of last year, while year to date through the second quarter at one is welcomed over 35000 gas seven events, where we will rebrand Arvada club.
Other cost of F. One revenue was higher primarily due to the same factors. These costs were up $76 million in second quarter, approximately 75% of which is due to freight and hospitality cost variances.
Finally at F. One at last year's Investor Day, we included an appendix slide detailing up one's foreign exchange exposure. These percentages are still accurate with approximately 80% of that once revenue and cost denominated in U S dollars.
Finally at the Braves group at quarter end, they had attributed cash and liquid investments of 207 $207 million, which excludes $66 million of restricted cash.
Branch group had attributed principal amount of debt $602 million.
The Atlanta Braves also announced several new construction projects for 2022, New office building will be constructed known as five ballpark center that will house the National headquarters for <unk> Securities under a 15 year lease construction is expected to begin in the second half of 2022.
The Braves estimate their cash contribution will be approximately $20 million.
The raise we're also working on a new project with Goldenrod development company called the Henry a luxury apartment building it.
If completed the brands would have a minority equity stake in exchange for two acres of contributed land with no additional cash contribution.
From the bras. Additionally, the brands are evaluating a phase II project and goldenrod to build an adjacent hotel and condominium complex.
It is still in the evaluation phase, but would be another minority investment with a modest cash investment.
Our real estate projects have individually and collectively performed ahead of our expectations.
The battery is generating healthy cash flow, which was partially used to support the operations of <unk>.
And future investments in the battery and partially to support Braves baseball.
Liberty in Arkansas, the subsidiaries are in compliance with our debt covenants at quarter end.
With that I'll turn it over to Stefano to discuss Formula one.
Thanks, Brian .
For the last earning calls we led in Miami for the inaugural Miami Grand Prix.
It was an incredible weekend as four one was welcome to the city with open arms.
Celebrities came out in full force and much of the coverage and health of the subs establishment of four one in the U S. It was wonderful to see so many of you in person.
We are now over halfway through the 2052 race season, and we have seen them predictable outcomes and lots of we'll do either bracing, especially in the mid field.
As a testament to the new regulation, that's everything that's good points already this is Kevin.
<unk> Securities first F. One career, a screen that says listen Lewis Hamilton marks.
So we have the Thrace talked with a second please fees the first double podium of this seasonal pharmacy. This is Ross.
Trump multiple stopped them currently leads the drivers championship over Charlotte.
Ferrari has shown incredible speed and the battle between these two is intense.
We have seen the fight between the Gladden out thing and it is great to see has beginning to move forward. Currently has 70 of the perspective.
And as we said, let's say Louis continues to fight with Luis and Georgia popular.
Is action on the track has drawn and defense will set out crowds at our events with the 420000. Another 400000 that the servicer. So he has a thousand in Austria 300000 in Hungary, and 338000 for Canada.
<unk> has experienced record sales will come in over 30000 people across 90 beds this year, including a record breaking attendance of Super well.
Well, we have 7500 guests.
The TV audience is also tuning in.
With the average order spoken a brief thoughts perhaps up to 9%. That's 2000 why don't season average.
We continue to see tremendous growth on all platforms, we were thrilled to announce that they're highly popular and that's C. This drive to survive has been renewed for the fifth and sixth season.
The scene is tracking new fans and Susan for broke into the weekly top 10 in 56 countries.
Building on the mass media rights, we reached a renewal agreement with <unk> in Brazil throughout 2025, which will cover all five session and get a please all alive frequent basis. Additionally, we secured a strategic partnership with collateral Brazil to be the exclusive.
<unk> F. One TV pro in the country.
And <unk> proven to be a compelling product for our fans. So it's worth a brief overview.
If one TD pro office coverage of every if one sees session live on demand as well as live access to old 'twenty on both drivers cameras and seems radio channels seizure session replays and highlights live streaming of every as to its re enforced supercut obsession and the library spending.
Over 2000 hours of archives and feature programming.
The platform was revamped in 2021 and is now more accessible than ever before with the release of the service across May youll be stream platform enhancing the viewing the screens performed one fans around the world.
Also the recent promotional side, we were pleased to reach a long term agreement with them that but that will have aspiration there through 2035.
These new agreements will bring <unk> in the three to the track for the first time ever.
We were also thrilled to them.
<unk> home that as the title sponsor of the Joplin has grown three well we'd assumed to Japan in October .
We are focused on the calendar for 2023 and expect to have more of these teams around early October .
On disposal ship front, we announced Pottsville tequila as the first ever official Tequila Plaza of the Epsilon father, plus we also focused on licensees opportunity importantly, with around room. So for the first official exhibition for one history.
Dates including venues on the same states, we'll think we'll will be announced this fall. We also extended our agreement with the momentum group through the 2055 season.
These already covered authentic certified the license if women more immediate and now includes the right to sell excess one race and show cars.
The recently completed the auction afforded 90, 90, Laythan House, CG, <unk>, which placed second in defense group, we sold well over 500000 pounds.
We continue to push to keep our net zero carbon by 2030 target.
One is developing a 100% sustainable fuel that will be used in former ones cost from 2026 in line with the introduction of the next generation I presented the few of these purposely designed to drop in for both internal combustion engine and diapers.
It is already in development with support from our key stakeholders the FAA.
And from the F. One global partners, who will provide this and therefore pizza manufacturer.
While recent fuel represents only 0.7% of our emission we believe sustainable fuels, where we can have a greater impact on the global transportation sector.
While we have already instituted a significant changes to create the most sustainable sport. We have now what was it on the phone with me at Arris exploring capital reduction measure for fast revenue is two fold one events sharing the cover infection the activities from across our sports and community.
Taking steps and continue to investigate that with the measures to deliver more efficient logistics and travel arrangements from C.
C L.
Firstly, our commitment to the environment. We are partnered with Banco sensor that to amplify the sense of the global challenge comes down to zero I competition that challenges and some printers to create sustainable solution for the future.
We continue to promote diversity in EBIT esport and hosted the F. One is food woman why codecs previous day at the Mclaren technological centers.
First launched in 2020 was the woman the wildcard represents another route into F. One esports pulse we made participants.
Initially it was born from the desire to create the space that encourage more females to take part in soup in the time trials via the official and therefore, we do games with a paas is securing the sport in the F. One esport prohibition for the chance to be selected by a team for the Pro Championship later this year.
We also announced that is in a year I would extend that funding commitment to the full one and Judy a scholarship program for and represented group until 2025 continually strive to increase diversity within the sports.
We hope everyone has enjoyed the first parts of the season.
While the teams and the drive is enjoying a much deserved break we will continue to capitalize on the growing popularity of us one and convert these into opportunities to drive the business forward Avanti to full speed ahead, and now I will turn the call back over to Greg.
Bye bye.
Yeah.
Thank you, Brian and Stefano.
Our annual Investor Day will be Thursday November 17th in New York. Please save the date additional.
Additional details will be provided soon we hope to see many of you there.
We appreciate your continued support of and interest in Liberty media and with that operator, I'd like to open the line for questions.
Yeah.
If you'd like to ask a question today. Please signal by pressing star one on your telephone keypad. If you are joining us using a speaker phone. Please release to mute feature.
To allow your signal to reach our equipment once again that star one if you'd like to ask a question today.
I will turn first to Ben Swinburne with Morgan Stanley .
Thank you and good morning.
Greg a couple a couple of things on the structural side wanted to ask you about you mentioned separating live nation I think you've mentioned I mentioned in that context with.
El series can you just talk about sort of the frozen because that could be and just to be Ben just to be crisp I said highlights the value I didn't say separate but go ahead. Okay highlight the value. Okay. Yeah. I guess my question was sort of how do you highlight the value.
I'll, let you add to that as you see fit and then I wanted to you know like we get the question quite a bit I'm sure you do too about hard spin of the Braves I was just curious if you could just comment on kind of the puts and takes and pros and cons to that thought process.
And then I wanted to ask you and then Stefan or whoever wants to take it on on Vegas. What are you guys doing in second half of this year in terms of of both staffing up.
And on the Capex side with the track in the Paddock club or any way to help frame sort of the investment.
Size here as you look into the back half of the year as you get ready for next year's race. Thanks.
So we I'll try and answer the structural questions and then touch on Vegas, but others as well.
So on the structural side look we're not here to announce anything today.
You'll know when we do.
And.
The advantages of our structure had been.
With the trackers have allowed us to have flexibility to move assets around have allowed us to have a flexibility to.
Align things in the most.
Attractive way to manage our taxes in the most efficient manner.
There are.
Our reasons to want to keep things together until we have ATB flexibility.
Around all of them are that's just more optionality.
As far as how we might highlight.
You know value.
There are ways from spinning to creating another tracker to to other kinds of actions we can take.
We haven't obviously decided antidotes that we'd be announcement today.
The.
The.
History of Liberty is as we've tended to over time take these business to where we thought they were we could add value and keep them internally and then at some point.
Spin them out.
We thought that they would be more attractive as independent entities up for the long term not just in the short term.
And Oh, we'll monitor all that for all of our entities. So obviously I'm, giving you as much of a non answer as I can Ben but that's just with our history.
So you should look at our history and say, we have taken corporate actions to spin things off and I went through a few of them and the subsequent disposition of those companies.
On Vegas, it's a little hard to forecast the capex because we are still putting together the program that we will undertake there and I mentioned our goal is to have a facility, which is not only magnificent for the race, but has the opportunity to be an ongoing activation.
Have ongoing activations and events at that facility when people when the race has gotten underway.
You know I think you should be thinking we can well manage this within the capital we have.
It's not going to drain us in any way and it's not going to forestall us from doing other actions, including you know.
Italy.
Investments around this back repurchases debt management and alike.
I don't know if.
If Brian or Rene or stuff and I want to add anything on the Vegas question.
Yeah, Tony if I can.
And.
If I can Greg just to add on the fact that of course, the capex it builds and the tight drove him he's dead with just the almost six months 16 months ago, but it's important that we are working very hard and drive user engagement and getting the new city excited before one so we got a come back.
Did you tell with all the plans that we have a little bit to make sure that we want to bring it to life with emotional passion that he is really important to increase the level of engagement that we had a spectrum Vegas city.
Thank you everybody.
Thanks.
Yes.
We will take our next question from Bryan Kraft with Deutsche Bank.
Thank you good morning, I guess Gregg also had.
The structural question I guess, it you know in eliminating or narrowing the NAV discount to <unk>.
It sounds like you alluded to an RMT spin merge I guess another option that you have would be to distribute Sirius XM cherish the liberty shareholders.
Former though would basically make the combined company, there's still a liberty company with Liberty.
Water management.
And the Liberty.
For Liberty management, and board to make strategic investments and acquisitions, the latter would sort of.
<unk> be an exit.
From that as a management team so I guess.
Both of those on the table or do you really want to kind of still control serious and be able to use it strategically and then I also wanted to ask a question on Formula one cost how should we think about the higher SG&A level. This quarter in the context of future quarters. It seems as though there may have been some temporary impacts and there are some legal advice.
Or is he is.
I guess is that the right way to think about it.
Or is or is that a meaningful.
Or is there kind of a reset in the SG&A run rate going forward and maybe that has to do something let's say I guess thanks.
Sure.
So on the first point I think.
Brian There's a wide range all the way from.
Distribution of shares which would probably not would be you know.
Unless you can figure out some way to get compensated for our control position probably not optimal there are things that are halfway in the middle like as you may remember with the midyear, where we did where we spun our Directv shares, but we still had in the form of the.
B shares having influence.
Two took to heart spends that are just fully away or even sub subsequent spin mergers like the GCI example, or like effectively what we get in Expedia. So I don't think theres any anything off the table based on either what we might do there or our history. I think there is a full range of opportunities and we'll try and do the one that we think maximize long term value.
Yeah.
On the.
On the AR side of expenses.
I'll, let others comment as well, but we will know we did have some increased expenses increased investment to start up around the Vegas.
Including some some issues.
Issues there so.
As far as the longer term I think we're not at an elevated level, but I'll, let others add their views.
Yeah. This is Brian I I'd say, we had some higher personnel and other costs to support the the large increase in revenues and higher activities that we had in 2022 versus the prior year. There were some minor one time professional fees that we wouldn't expect to repeat and I would say pretty mine.
And her Vegas expenses at this point in time.
Okay. Thank you very much.
Yeah.
Yes.
We'll go next to Vijay Jayant with Evercore.
Evercore.
Thanks.
Formula One obviously, Greg there'd be equity is is is like because the contractual nature of the business, but obviously there are numerous macro headwinds with.
Inflation higher rates, obviously, you gave some color on the impact of Forex.
And you know would be S gave us can you help us really think about what the.
The variability of outcomes all given all of those.
You know sort of pressures out there given your contractual nature of the business is sort of the budget and expectations pretty much in line with what you thought are expected at the beginning of the year kind of thing for what.
<unk> could be at Formula one operation.
So I think a couple of things I think you're right to note P. J the highly contracted nature of the business.
And which manages downside obviously, there's FX downside and there's cost potential downside, but in general we've seen demand that's been able to outstrip those and while we make budget conservatively with contingencies as our nature.
We've been able to outperform those contingencies, even light of the cost structures.
So I remain you know I believe the demand that we have and the strength of the business.
On top of the contracted nature will allow us to power through most of that but obviously, we can't foresee every.
Inflationary impact, but in general I think we've been able to work through those and the FX.
Brian Stefano anyone else wants to add.
I think that I'd add Greg.
And if I could follow up obviously.
Maybe a little early on the race calendar for next year, but there's a bunch of European races that comes sort of end of contract it looks like France, Belgium Monaco.
Obviously, you have a couple of new races next two coming you know Qatar coming back in Shanghai coming back can you just talk about you know what what the sort of race outlook can be next year is obviously going to have more than 22 races, and I'm gonna get more sort of higher dollar value races versus some that are not as lucrative.
I'll, let if I may Greg where Stefano.
Please okay. Thank you actually I mean, that's yeah.
As I've stated before you know we will come back to the early October .
Due to the process of of course, having to clear for the world multiple counts you love with Colenso <unk> of course, a lot of discussion to make sure that the Columbia is robust.
It's totally old so the fact that we would like to keep the rates low in terms of efficiency around the world that could see the.
Needs over to Linda to be spread out from March to November all around the world and of course, the effect that you would see before there.
On the choice between the European and the Ultimate European races has an effect on the on the on the on the revenue side, but I would say the main the main boyne piece to wherever in the type of calendar. The demand is very very high in these that were supposed to be to put in place like a lender that is available to our stakeholders, but look so bad.
Please go to the to respond to the request that we got a little bit about the world. So Oh, we cannot spot anything more than what we are saying because we are of course finalizing all the details, but we for sure expect why but I would say a couple of reasons more than this year, but less than 25 that's for sure.
Thanks, so much.
Next up is David Karnofsky with J P. Morgan.
Hi, Thank you for Stefano we've seen in the press the possibility of some auto Oems entering if one either on the manufacturer engine side and a question. We sometimes get is what's the potential benefit to formula one either from a commercial standpoint or to the product itself. So I wanted to put that question to you and then separately with <unk>.
Other F. One revenue I know theres a lot of noise in there because of the freight costs, but wondering if you could speak to the performance outside of the pass through revenues in particular areas like Paddock club licensing and maybe how that looks relative to the pre pandemic period. Thanks.
Okay.
I mean with regard to the two new Oh, yeah coming in as you can imagine as you know there's not enough for us to say anything that there will be let's say.
We shouldn't say, it's it's too bad we adding Tulsa, we bought the manufacturer then hopefully we have other inflammation soon I think that intermodal, but what is the benefit the bezeq push real credibility. The benefit is showing that our strategy of the future will help the manufacturer to have another route.
That's allowed them not to be oldest completely electric in the offer to the mobility side, but also using the expertise that only pool one through the thick knows that we have can help them in order to find new way of being the president of the mug I presented you with sustainable fuel that will be enabled to be much more effective now that opinion.
All around the World if you want to eat the global carbon neutrality and all the other hand from the support point of view the more money we have the more structure in terms of having manufactured with other teams will enable you know the sporting side to add but.
But I would say more teams that could be seen even in the more independent input into the sports. So I think that would be to read the news, let's see how the situation will evolve, but no matter what will be the decision that that the Oems will will will will.
It will provide to the market hopefully very soon we are strongly believers that our technological platform for the future is denied boarding term over that and see and this is something that the AR factoring to prove that.
And if I can just add.
If I could just add on.
Stephen I'd, just add you know obviously Stefan I'll touch on is its a great validation.
To have these Oems.
Want to enter or are reportedly want to enter if they were they're both the once discussed or both.
Enormous.
Engines of innovation and enormous engines of promotion and all of those are only seem to be good for our sport.
And of course, I mean, they were up.
No no I was just trying to briefly touch base on the second question, we see and this is what we already seen the IFF will be she is incredible numbers with regards to public love what they got two new licenses that will that would be seen as an effect on our balance sheet and we see already an incredible number of a boat.
The Glenda has not been announced already come up with it so they should put us for the for the the basis that would be in any case. It definitely the collateral next year. So they could eat the attention that needs the attention.
On our platform, who should be the huge today.
Yeah, and just just to add to that David.
And the other F. One category, 98% of what we're seeing on the increases all coming from.
Paddock club in freight as we talked about in our prepared remarks, where we did not raise last year and we weren't traveling as much so big increases there, but within primary revenue.
We're seeing increases across the board as Stefano just mentioned so licensing to your point and F. One TB as well as the main three categories promotion sponsorships media rights.
Thank you all if you look at some of these things like Paddock club, Yeah, I'd just add Brian I mean, if you look at some of these things like Paddock club, we've never seen more demand.
And we've not only seen demand we've been able to in some cases promoters are able to increase the size of the paddock club areas and still manage that at a higher number at higher prices. So a lot of positives there.
Thank you.
Alright.
Hudson Securities has our next question.
Alright, thanks for taking the question.
Greg.
Just count at Liberty Sirius versus serious.
It's so much larger than the discount you would see whats at Liberty broadband charter.
Why do you think that is why is there such a disconnect there.
Does that inform it anyway, you know what some of the solutions might be for that.
Barton that's a great question.
I think.
You could argue a little more complexity you could argue.
Investor fatigue, you could argue the relative scale and size of the two entities compared to a broadband entity.
Hard to attribute.
Any certainty to any of those but those are probably all factors.
Fear that we're not going to act on it in some way, whereas at broadband and maybe it's more crisp, where the futures going all of those are potential factors.
I think as you said, we said before.
I said earlier on this call, we're going to take advantage of that through the.
The discount and at some point, we're going to take an action that we're looking at those actions due to tightened that discount but in the interim we're going to buy that stock and take advantage of it and drive our NAV would be relevant to the underlying NAV would be up.
I don't know if anybody else on the team down there if somebody else wanted to add something but I think it's hard to be determined of about which of these factors is driving the difference.
Okay.
And if I could ask one other kind of separate question.
I'm just interested in your perspective on.
Streaming at this point as it pertains to kind of baseball.
We have the direct to consumer.
Launches at NASA and at Diamond Sports.
The Braves or not participating at this point.
He spent some roll up of rights that some of the.
Big platform players like Apple.
And.
Do you think that this is the time to move in an and.
Restructure.
Right.
For baseball or do you think it's not right. Yeah, you don't know what to do yet.
Well I think.
Baseball.
Has a more complicated situation he talked about the regional sports network situation then.
Other sports in particular.
Cleanup comparisons or the completeness it's football.
And certainly my understanding is MLP would love to find a structure, where they could deliver a more national rights.
Which is willing out available or difficult today on some kinds of games.
The.
Streaming interest has been high from people like Apple, which is a good sign and obviously the RSM weakness is going to create an opportunity whether that happens this year or next I do think there will be some change in that given where diamond appears to be headed.
Looking just at the Braves.
We're blessed as we've said before with a lot of demand.
And good audience in our territory, we're also blessed with the largest <unk>.
Broadband.
Household territory among baseball teams.
So we remain optimistic about our relative position on any kind of streaming.
Deal and we feel good that.
We have a product which people want in a big territory and probably what some people estimate may be the most profitable our S N, where we're getting paid pretty well, but the RSA at all or is also making money. So that seems to create some opportunity where there'll be somebody who wants to something interesting in our space.
But stay tuned.
Okay. Thank you.
Thank you.
Mr. David Joyce with Barclays.
Thank you.
I guess, some more clarifications on the structural opportunities.
Greg I think you mentioned.
Response to Ben's question something about.
You know the reasons to keep things together until you have full ATB flexibility, Oh, maybe I misheard or misunderstood, but then you thought that everything was Oh it was.
Just wondering if you know what.
Oh, hi, there still.
Well I think where we are if I could just interrupt David I said, that's one of the factors, we love to have as much flexibility on atvs as possible as many.
So that's a factor.
That's not the only reason I think I've mentioned to keep.
The corpus together or to keep things as I mentioned some of the other reasons around ability to move assets tax advantaged tax lexical et cetera, sorry go ahead I didn't.
Just wanted to check before you set the question I want to make a car that's not.
No that's fine.
No. That's fine that's the clarification is was part of my question and then the other aspect is are there any other further.
Getting factors on the on the separation of the equities.
Such as you know you do need to prioritize getting something done with El mech, the spec or is or is.
Is that completely separate paths.
Yeah, I don't I can't I don't not only a top of my head, but I'll just note. The one you called out I don't think any.
Anything we're going to do around Almac stack is likely to be impacted by structural changes because you know, it's generally getting funded by the excess cash and any incremental would be funded by the other further excess cash at four so I don't I don't think that's a that's the driver.
Okay I appreciate it thank you.
Thank you.
Yeah.
Next up is Jason Bazinet with Citi.
I just had a high level question you guys over the years have done such a good job improving the finance financials with the Braves and Formula one.
I would just be curious as you sort of look at the landscape would you describe both of those are sort of one off you know rare.
<unk> unique unique opportunities.
Or do you think you're sort of building a competency that might be applicable to other potential assets.
Experience.
Yes, I don't know.
I don't know if we have a competency I'd like to think that a credit to the teams at both the Braves and Formula one.
For what they've done with those assets.
They've taken attractive businesses and only made them better.
And I credit that so if a if we deserve any credits for finding the right management teams and packing them in doing the great work that they've done.
I'm not sure we can take much beyond that.
Okay. Thank you.
Yeah.
Now, we'll move to Matthew Harrigan with benchmark.
Oh, thank you.
Firstly getting more specific on the Sim fuels the answers Theres a report in the European the Porsche is something down in Chile.
They're testing, that's basically carbon capture synthetic methanol and the store he also alluded to.
Saudi Aramco building plants in Saudi Arabia.
I mean, I guess, you probably wouldn't be that specific but have you nail down a path on the technology or you're looking at a lot of different things.
And what sort of capital commitment just big we would go into having that that's sort of playing out.
Sounds.
Little more real as well as aspirational.
At this point.
And then secondly on.
On the denser that.
Ticketmaster did with snapshot.
Now what with Tic Toc is that something that you really see.
<unk> advent demand as well as you know People's propensity you just you get out outside the house right now and then I had one super quick follow up if you don't mind.
Stefano do you want to take this synthetic fuel question.
Yep Yep. Thank you. Thank you Greg. Thank you Michael I think that you know all these technology Catholic capture and other things that are related to the passive technology is related to the transition this sector well, David and the beauty of what I believe we are doing that with the tremendous effectiveness is the fact.
That's it you know we have just pushing the system toward towards the future in the right way. So all of that the commitment that we have taken on our site to go through two zero camp a few of them are in <unk>.
Such a short term needs because we do believe that that's what I want to go and the good news is that the other side the investment or notwithstanding is not relevant because we didn't we didn't own any capex in that respect. So we adjust the enabler who the oldest stakeholders all of these as the push for the future and this is something we do.
But he said I'll wait to go and that and that we don't have to forget.
Oh, one other important elements of the equation that we're not talking about them not only about the manufacturer.
First of all with peaks, but without with the our system. We are promoters, we are but a lot of the people that they have to invest a lot because we are talking about.
Big events were talking places, where the needs of energy.
Hosting are going to be worth it up more than 400000 people needs to have a path all the evolution of this technology and this is also where we have a push of the season, we group it toward this direction. So I think we should be very very proud of this idea of push and pull with these technologies through our leadership on that respect.
Yeah.
And Matthew on the second point I'm not sure exactly what you're referring to maybe you can help.
Good question it sounds like you're hesitant to comment on the operating companies, but yeah.
They do that.
The arrangement with snapshot of a number of months ago to push basically ticketmaster pushing up tickets on one snapshot and I've just a couple of days ago, and now something similar with Tic Toc.
That's something that you really see as being a nice niche business.
The demand on the ticketing side do you think it's just deeper Stewart Crazy go bad and they just wanted to get outside outside the house.
Well I think.
It's part of live nation strategy to be ubiquitous as possible and making by ticket.
Tickets as simple as possible and the technologists did get dealt to distribute their ticket buying capabilities are unique advantage I think compared to most in the industry and they want to be where buyers are and if buyers are on tictoc, which they increasingly are looking for music and that's a place which would they originate the logical place for them to be in it.
Same thing I think about snap, which has obviously had music aspirations as well so.
I think it's an important element.
Element of continuing to grow the strategy, but I'm not sure. It's it's uniquely different than anything else. We've done it just a continuation.
And then lastly, if you don't mind do you have a secular you want sports teams valuations going up even higher that makes you want to wait for that.
In terms of doing something.
I think its facts and circumstances will dictate obviously these have been trophy assets that are that people have wanted to buy the best stuff.
We certainly looked at purchasing in lots of cases, other sports assets and Ben.
Surprised that some of the prices Nonetheless, they continue to move upwards and I think for the right kind of trophy assets, probably the valuations are kind of continue to rise.
Thanks, Greg.
Thank you.
And with that we'll conclude with a question and answer session.
I'll now turn the call over to the speakers.
No I just wanted to say thank you to all our listening audience for your questions and your attention.
I appreciate your interest in Liberty Media Hope to see you next quarter, if not sooner and again I don't know remember meeting for many of you.
Have a great rest of your summer. Thank you.
Thank you bye bye.
With that we'll conclude today's conference. Thank you everyone for your participation you may now disconnect.
Yeah.
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Okay.
Okay.