☒ | ||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 84-3755666 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Two Penn Plaza | New York | , | NY | 10121 | |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Class A Common Stock | MSGE | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Class A Common Stock par value $0.01 per share | — | 27,324,977 | ||||||
Class B Common Stock par value $0.01 per share | — | 6,866,754 |
Explanatory Note | |||
Financial Statements | |||
Management’s Discussion and Analysis of | Results of Operations | ||
Part I—Item 4. | Controls and Procedures | ||
Part II—Item 1A. | Risk Factors | ||
Part IV—Item 6. | Exhibits |
March 31, 2020 | June 30, 2019 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 1,003,893 | $ | 1,082,055 | ||||
Restricted cash | 17,955 | 10,010 | ||||||
Short-term investments | 331,019 | 108,416 | ||||||
Accounts receivable, net | 105,212 | 81,044 | ||||||
Net related party receivables | 2,288 | 1,722 | ||||||
Prepaid expenses | 39,255 | 24,067 | ||||||
Other current assets | 40,581 | 39,430 | ||||||
Assets held for sale | 109,155 | — | ||||||
Total current assets | 1,649,358 | 1,346,744 | ||||||
Investments and loans to nonconsolidated affiliates | 61,998 | 84,560 | ||||||
Property and equipment, net of accumulated depreciation and amortization | 1,540,786 | 1,349,122 | ||||||
Right-of-use lease assets | 234,760 | — | ||||||
Amortizable intangible assets, net | 155,948 | 214,391 | ||||||
Indefinite-lived intangible assets | 64,881 | 65,421 | ||||||
Goodwill | 81,996 | 165,558 | ||||||
Other assets | 37,438 | 89,963 | ||||||
Total assets | $ | 3,827,165 | $ | 3,315,759 | ||||
See accompanying notes to combined financial statements. |
September 30, 2021 | June 30, 2021 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 1,331,450 | $ | 1,516,992 | ||||
Restricted cash | 24,029 | 22,984 | ||||||
Accounts receivable, net | 178,449 | 184,613 | ||||||
Net related party receivables | 44,316 | 31,916 | ||||||
Prepaid income taxes | 1,850 | 12,772 | ||||||
Prepaid expenses | 70,639 | 67,445 | ||||||
Other current assets | 38,388 | 36,014 | ||||||
Total current assets | 1,689,121 | 1,872,736 | ||||||
Investments in nonconsolidated affiliates | 48,140 | 49,221 | ||||||
Property and equipment, net | 2,284,729 | 2,156,292 | ||||||
Right-of-use | 413,463 | 280,579 | ||||||
Amortizable intangible assets, net | 186,169 | 198,274 | ||||||
Indefinite-lived intangible assets | 63,801 | 63,801 | ||||||
Goodwill | 500,181 | 502,195 | ||||||
Other assets | 152,316 | 166,781 | ||||||
Total assets | $ | 5,337,920 | $ | 5,289,879 | ||||
March 31, 2020 | June 30, 2019 | |||||||
(Unaudited) | ||||||||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND DIVISIONAL EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 18,766 | $ | 23,974 | ||||
Net related party payables, current | 31,728 | 18,911 | ||||||
Current portion of long-term debt, net of deferred financing costs | 4,792 | 6,042 | ||||||
Accrued liabilities: | ||||||||
Employee related costs | 70,418 | 82,411 | ||||||
Other accrued liabilities | 117,207 | 88,614 | ||||||
Operating lease liabilities, current | 54,506 | — | ||||||
Collections due to promoters | 49,421 | 67,212 | ||||||
Deferred revenue | 206,045 | 186,883 | ||||||
Liabilities held for sale | 72,811 | — | ||||||
Total current liabilities | 625,694 | 474,047 | ||||||
Related party payables, noncurrent | — | 172 | ||||||
Long-term debt, net of deferred financing costs | 29,962 | 48,556 | ||||||
Operating lease liabilities, noncurrent | 191,762 | — | ||||||
Defined benefit and other postretirement obligations | 32,359 | 41,318 | ||||||
Other employee related costs | 17,570 | 15,703 | ||||||
Deferred tax liabilities, net | 13,131 | 22,973 | ||||||
Other liabilities | 77,770 | 59,525 | ||||||
Total liabilities | 988,248 | 662,294 | ||||||
Commitments and contingencies (see Note 10) | ||||||||
Redeemable noncontrolling interests | 23,000 | 67,627 | ||||||
Company Divisional Equity: | ||||||||
Madison Square Garden Sports Corp. Investment | 2,851,522 | 2,618,971 | ||||||
Accumulated other comprehensive loss | (52,607 | ) | (46,923 | ) | ||||
Total Company divisional equity | 2,798,915 | 2,572,048 | ||||||
Nonredeemable noncontrolling interests | 17,002 | 13,790 | ||||||
Total divisional equity | 2,815,917 | 2,585,838 | ||||||
Total liabilities, redeemable noncontrolling interests and divisional equity | $ | 3,827,165 | $ | 3,315,759 |
September 30, 2021 | June 30, 2021 | |||||||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 26,465 | $ | 26,644 | ||||
Net related party payables, current | 21,213 | 23,173 | ||||||
Current portion of long-term debt, net of deferred financing costs | 55,228 | 53,973 | ||||||
Income taxes payable | 1,126 | 2,527 | ||||||
Accrued liabilities: | ||||||||
Employee related costs | 47,295 | 91,853 | ||||||
Other accrued liabilities | 221,345 | 210,749 | ||||||
Operating lease liabilities, current | 53,571 | 73,423 | ||||||
Collections due to promoters | 61,652 | 37,877 | ||||||
Deferred revenue | 265,950 | 209,651 | ||||||
Total current liabilities | 753,845 | 729,870 | ||||||
Long-term debt, net of deferred financing costs | 1,621,194 | 1,650,628 | ||||||
Operating lease liabilities, noncurrent | 396,569 | 233,556 | ||||||
Defined benefit and other postretirement obligations | 53,412 | 54,179 | ||||||
Other employee related costs | 21,464 | 21,193 | ||||||
Collections due to promoters, noncurrent | 0 | 6,625 | ||||||
Deferred tax liabilities, net | 177,781 | 200,325 | ||||||
Other liabilities | 77,238 | 75,263 | ||||||
Total liabilities | 3,101,503 | 2,971,639 | ||||||
Commitments and contingencies (see Note 11) | ||||||||
Redeemable noncontrolling interests | 140,410 | 137,834 | ||||||
Madison Square Garden Entertainment Corp. Stockholders’ Equity: | ||||||||
Class A Common stock, par value $0.01, 120,000 shares authorized; 27,305 and 27,093 shares outstanding as of September 30, 2021 and June 30, 2021, respectively | 273 | 271 | ||||||
Class B Common stock, par value $0.01, 30,000 shares authorized; 6,867 shares outstanding as of September 30, 2021 and June 30, 2021 | 69 | 69 | ||||||
Preferred stock, par value $0.01, 15,000 shares authorized; NaN outstanding as of September 30, 2021 and June 30, 2021 | 0 | 0 | ||||||
Additional paid-in capital | 2,293,157 | 2,294,775 | ||||||
Accumulated deficit | (175,573 | ) | (96,341 | ) | ||||
Accumulated other comprehensive loss | (35,060 | ) | (30,272 | ) | ||||
Total Madison Square Garden Entertainment Corp. stockholders’ equity | 2,082,866 | 2,168,502 | ||||||
Nonredeemable noncontrolling interests | 13,141 | 11,904 | ||||||
Total equity | 2,096,007 | 2,180,406 | ||||||
Total liabilities, redeemable noncontrolling interests and equity | $ | 5,337,920 | $ | 5,289,879 | ||||
Three Months Ended | Nine Months Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues (a) | $ | 199,861 | $ | 250,018 | $ | 767,038 | $ | 832,384 | ||||||||
Operating expenses: | ||||||||||||||||
Direct operating expenses (b) | 132,809 | 158,710 | 472,582 | 507,249 | ||||||||||||
Selling, general and administrative expenses (c) | 84,186 | 83,159 | 257,970 | 231,038 | ||||||||||||
Depreciation and amortization | 26,196 | 26,768 | 80,271 | 81,606 | ||||||||||||
Impairment for intangibles, long-lived assets, and goodwill | 102,211 | — | 102,211 | — | ||||||||||||
Operating income (loss) | (145,541 | ) | (18,619 | ) | (145,996 | ) | 12,491 | |||||||||
Other income (expense): | ||||||||||||||||
Earnings (loss) in equity method investments | (1,096 | ) | (2,881 | ) | (3,739 | ) | 17,131 | |||||||||
Interest income (d) | 3,659 | 7,987 | 17,242 | 22,020 | ||||||||||||
Interest expense | (605 | ) | (3,247 | ) | (1,854 | ) | (10,076 | ) | ||||||||
Miscellaneous income (expense), net (e) | (17,381 | ) | 4,613 | (2,893 | ) | (4,118 | ) | |||||||||
(15,423 | ) | 6,472 | 8,756 | 24,957 | ||||||||||||
Income (loss) from operations before income taxes | (160,964 | ) | (12,147 | ) | (137,240 | ) | 37,448 | |||||||||
Income tax benefit (expense) | 10,126 | (469 | ) | 8,686 | (1,253 | ) | ||||||||||
Net income (loss) | (150,838 | ) | (12,616 | ) | (128,554 | ) | 36,195 | |||||||||
Less: Net loss attributable to redeemable noncontrolling interests | (22,447 | ) | (7 | ) | (23,851 | ) | (3,662 | ) | ||||||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 195 | (680 | ) | 38 | (3,121 | ) | ||||||||||
Net income (loss) attributable to the Company | $ | (128,586 | ) | $ | (11,929 | ) | $ | (104,741 | ) | $ | 42,978 | |||||
Basic and diluted earnings (loss) per common share attributable to the Company (f) | $ | (5.36 | ) | $ | (0.50 | ) | $ | (4.37 | ) | $ | 1.79 |
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Revenues (a) | $ | 294,510 | $ | 170,546 | ||||
Operating expenses: | ||||||||
Direct operating expenses (b) | 165,761 | 99,231 | ||||||
Selling, general and administrative expenses (c) | 174,839 | 81,657 | ||||||
Depreciation and amortization | 29,430 | 28,410 | ||||||
Impairment of long-lived assets | 7,818 | 0 | ||||||
Restructuring charges | 0 | 19,927 | ||||||
Operating loss | (83,338 | ) | (58,679 | ) | ||||
Other income (expense): | ||||||||
Loss in equity method investments | (1,207 | ) | (1,696 | ) | ||||
Interest income | 775 | 772 | ||||||
Interest expense | (9,248 | ) | (5,273 | ) | ||||
Miscellaneous income (expense), net | (2,547 | ) | 34,017 | |||||
(12,227 | ) | 27,820 | ||||||
Loss from operations before income taxes | (95,565 | ) | (30,859 | ) | ||||
Income tax benefit (expense) | 18,910 | (9,457 | ) | |||||
Net loss | (76,655 | ) | (40,316 | ) | ||||
Less: Net income (loss) attributable to redeemable noncontrolling interests | 2,212 | (3,889 | ) | |||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 365 | (630 | ) | |||||
Net loss attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (79,232 | ) | $ | (35,797 | ) | ||
Basic and diluted loss per common share attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (2.32 | ) | $ | (1.05 | ) | ||
Weighted-average number of common shares outstanding: | ||||||||
Basic and diluted | 34,095 | 34,165 |
(a) | Includes revenues from related parties of |
(b) | Includes net charges from related parties of |
(c) | Includes net charges to related parties of |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
March 31, | March 31, | |||||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||||||||
Net income (loss) | $ | (150,838 | ) | $ | (12,616 | ) | $ | (128,554 | ) | $ | 36,195 | |||||||||||||||||||||
Other comprehensive income (loss), before income taxes: | ||||||||||||||||||||||||||||||||
Pension plans and postretirement plan: | ||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive loss: | ||||||||||||||||||||||||||||||||
Amortization of actuarial loss included in net periodic benefit cost | $ | 342 | $ | 328 | $ | 1,027 | $ | 984 | ||||||||||||||||||||||||
Settlement loss recognized | 67 | — | 67 | — | ||||||||||||||||||||||||||||
Amortization of prior service credit included in net periodic benefit cost | — | 409 | (1 | ) | 327 | — | 1,094 | (4 | ) | 980 | ||||||||||||||||||||||
Cumulative translation adjustments | (19,946 | ) | 6,383 | (6,778 | ) | 3,181 | ||||||||||||||||||||||||||
Other comprehensive income (loss) | (19,537 | ) | 6,710 | (5,684 | ) | 4,161 | ||||||||||||||||||||||||||
Comprehensive income (loss) | (170,375 | ) | (5,906 | ) | (134,238 | ) | 40,356 | |||||||||||||||||||||||||
Less: Comprehensive loss attributable to redeemable noncontrolling interests | (22,447 | ) | (7 | ) | (23,851 | ) | (3,662 | ) | ||||||||||||||||||||||||
Less: Comprehensive income (loss) attributable to nonredeemable noncontrolling interests | 195 | (680 | ) | 38 | (3,121 | ) | ||||||||||||||||||||||||||
Comprehensive income (loss) attributable to the Company | $ | (148,123 | ) | $ | (5,219 | ) | $ | (110,425 | ) | $ | 47,139 |
Nine Months Ended | ||||||||
March 31, | ||||||||
2020 | 2019 | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | (128,554 | ) | $ | 36,195 | |||
Adjustment to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 80,271 | 81,606 | ||||||
Impairment of intangibles, long-lived assets and goodwill | 102,211 | — | ||||||
Provision (benefits) from deferred income taxes | (9,842 | ) | 794 | |||||
Share-based compensation expense | 29,294 | 27,929 | ||||||
Loss (earnings) in equity method investments | 3,739 | (17,131 | ) | |||||
Purchase accounting adjustments associated with leases | 4,458 | 3,197 | ||||||
Unrealized loss on equity investment with readily determinable fair value | 2,471 | 2,405 | ||||||
Provision for doubtful accounts | 6,954 | 765 | ||||||
Other non-cash adjustments | (1,488 | ) | 2,569 | |||||
Change in assets and liabilities: | ||||||||
Accounts receivable, net | (31,413 | ) | (70,436 | ) | ||||
Net related party receivables | (566 | ) | (885 | ) | ||||
Prepaid expenses and other assets | (32,231 | ) | (38,937 | ) | ||||
Accounts payable | 3,327 | (4,589 | ) | |||||
Net related party payables | 12,645 | 18,693 | ||||||
Accrued and other liabilities | 46,519 | (2,359 | ) | |||||
Collections due to promoters | 15,924 | (16,953 | ) | |||||
Deferred revenue | 34,193 | 22,103 | ||||||
Operating lease right-of-use assets and lease liabilities | (961 | ) | — | |||||
Net cash provided by operating activities | $ | 136,951 | $ | 44,966 | ||||
Cash flows from investing activities: | ||||||||
Capital expenditures | $ | (326,596 | ) | $ | (114,313 | ) | ||
Proceeds from insurance recoveries | 476 | — | ||||||
Purchase of short-term investments | (405,935 | ) | (112,735 | ) | ||||
Proceeds from maturity of short-term investment | 176,661 | — | ||||||
Investments and loans to nonconsolidated affiliates | (75 | ) | (51,807 | ) | ||||
Proceeds from sale of nonconsolidated affiliate | 18,000 | 125,000 | ||||||
Loan repayment received from subordinated debt | 58,735 | 4,765 | ||||||
Cash received (paid) for notes receivable | 750 | (7,761 | ) | |||||
Net cash used in investing activities | $ | (477,984 | ) | $ | (156,851 | ) | ||
See accompanying notes to combined financial statements. |
Three Months Ended September 30, | ||||||||||||||||
2021 | 2020 | |||||||||||||||
Net loss | $ | (76,655 | ) | $ | (40,316 | ) | ||||||||||
Other comprehensive income (loss), before income taxes: | ||||||||||||||||
Pension plans and postretirement plan: | ||||||||||||||||
Amounts reclassified from accumulated other comprehensive loss: | ||||||||||||||||
Amortization of actuarial loss included in net periodic benefit cost | 510 | 478 | ||||||||||||||
Amortization of prior service credit included in net periodic benefit cost | 0 | 510 | 0 | 478 | ||||||||||||
Cumulative translation adjustments | (6,418 | ) | 13,951 | |||||||||||||
Other comprehensive income (loss), before income taxes | (5,908 | ) | 14,429 | |||||||||||||
Income tax benefit (expense) related to items of other comprehensive income (loss) | 1,120 | (2,732 | ) | |||||||||||||
Other comprehensive income (loss), net of income taxes | (4,788 | ) | 11,697 | |||||||||||||
Comprehensive loss | (81,443 | ) | (28,619 | ) | ||||||||||||
Less: Net income (loss) attributable to redeemable noncontrolling interests | 2,212 | (3,889 | ) | |||||||||||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 365 | (630 | ) | |||||||||||||
Comprehensive loss attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (84,020 | ) | $ | (24,100 | ) | ||||||||||
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (76,655 | ) | $ | (40,316 | ) | ||
Adjustment to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 29,430 | 28,410 | ||||||
Impairment of long-lived assets | 7,818 | 0 | ||||||
Amortization of deferred financing costs | 2,184 | 485 | ||||||
Benefit from deferred income taxes | (20,036 | ) | (9,590 | ) | ||||
Share-based compensation expense | 19,528 | 16,156 | ||||||
Loss in equity method investments | 1,207 | 1,696 | ||||||
Net unrealized loss (gains) on equity investments with readily determinable fair value | 2,460 | (33,658 | ) | |||||
Provision for credit losses | 437 | 645 | ||||||
Other non-cash adjustments | (89 | ) | (325 | ) | ||||
Change in assets and liabilities: | ||||||||
Accounts receivable | 5,546 | (5,508 | ) | |||||
Receivables from related parties, net of payables | (14,180 | ) | (15,472 | ) | ||||
Prepaid expenses and other assets | 17,202 | 12,626 | ||||||
Accounts payable | 191 | (9,518 | ) | |||||
Accrued and other liabilities | (47,232 | ) | (45,323 | ) | ||||
Collections due to promoters, including noncurrent portion | 17,150 | (8,498 | ) | |||||
Deferred revenue | 56,299 | 11,386 | ||||||
Operating lease right-of-use | 5,728 | 1,577 | ||||||
Net cash provided by (used in) operating activities | $ | 6,988 | $ | (95,227 | ) | |||
Cash flows from investing activities: | ||||||||
Capital expenditures | $ | (137,271 | ) | $ | (113,799 | ) | ||
Capitalized interest | (9,326 | ) | (355 | ) | ||||
Proceeds from maturity of short-term investments | 0 | 300,000 | ||||||
Cash received for notes receivable | 0 | 6,328 | ||||||
Other investing activities | 295 | 60 | ||||||
Net cash (used in) provided by investing activities | $ | (146,302 | ) | $ | 192,234 | |||
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Cash flows from financing activities: | ||||||||
Taxes paid in lieu of shares issued for equity-based compensation | $ | (14,903 | ) | $ | (8,071 | ) | ||
Noncontrolling interest holders’ capital contribution | 872 | 200 | ||||||
Distribution to related parties associated with the settlement of certain share-based awards | (516 | ) | 0 | |||||
Repayments of revolving credit facility | (15,000 | ) | 0 | |||||
Principal repayments on long-term debt | (15,250 | ) | (8,125 | ) | ||||
Net cash used in financing activities | $ | (44,797 | ) | $ | (15,996 | ) | ||
Effect of exchange rates on cash, cash equivalents and restricted cash | (386 | ) | 5,814 | |||||
Net (decrease) increase in cash, cash equivalents and restricted cash | (184,497 | ) | 86,825 | |||||
Cash, cash equivalents and restricted cash at beginning of period | 1,539,976 | 1,121,141 | ||||||
Cash, cash equivalents and restricted cash at end of period | $ | 1,355,479 | $ | 1,207,966 | ||||
Non-cash investing and financing activities: | ||||||||
Investments and loans to nonconsolidated affiliates | $ | 547 | $ | 0 | ||||
Capital expenditures incurred but not yet paid | $ | 122,469 | $ | 78,100 | ||||
Share-based compensation capitalized in property and equipment | $ | 751 | $ | 866 |
Nine Months Ended | ||||||||
March 31, | ||||||||
2020 | 2019 | |||||||
Cash flows from financing activities: | ||||||||
Noncontrolling interest holders’ capital contribution | $ | 4,000 | $ | 5,560 | ||||
Distributions to noncontrolling interest holders | (535 | ) | (1,263 | ) | ||||
Loans from noncontrolling interest holders | — | 606 | ||||||
Repayment of revolving credit facility | (15,000 | ) | — | |||||
Principal repayment on long-term debt | (5,000 | ) | (3,929 | ) | ||||
Net transfers from Madison Square Garden Sports Corp. and its subsidiaries | 283,435 | 31,604 | ||||||
Net cash provided by financing activities | $ | 266,900 | $ | 32,578 | ||||
Effect of exchange rates on cash, cash equivalents and restricted cash | 3,916 | 6,440 | ||||||
Net decrease in cash, cash equivalents and restricted cash | (70,217 | ) | (72,867 | ) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 1,092,065 | 1,232,356 | ||||||
Cash, cash equivalents and restricted cash at end of period | $ | 1,021,848 | $ | 1,159,489 | ||||
Non-cash investing and financing activities: | ||||||||
Non-cash acquisition of additional redeemable noncontrolling interests | $ | 37,715 | $ | — | ||||
Capital expenditures incurred but not yet paid | $ | 75,656 | $ | 17,515 | ||||
Tenant improvement paid by landlord | $ | 195 | $ | 13,715 | ||||
Share-based compensation capitalized in property and equipment | $ | 3,790 | $ | 1,926 |
Three Months Ended March 31, 2020 | ||||||||||||||||||||||||
Madison Square Garden Sports Corp. Investment | Accumulated Other Comprehensive Loss | Total Company Divisional Equity | Non - redeemable Noncontrolling Interests | Total Divisional Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||
Balance as of December 31, 2019 | $ | 2,638,955 | $ | (33,070 | ) | $ | 2,605,885 | $ | 16,807 | $ | 2,622,692 | $ | 66,223 | |||||||||||
Net income (loss) | (128,586 | ) | — | (128,586 | ) | 195 | (128,391 | ) | (22,447 | ) | ||||||||||||||
Other comprehensive loss | — | (19,537 | ) | (19,537 | ) | — | (19,537 | ) | — | |||||||||||||||
Comprehensive income (loss) | — | — | (148,123 | ) | 195 | (147,928 | ) | (22,447 | ) | |||||||||||||||
Net increase in Madison Square Garden Sports Corp. Investment | 320,377 | — | 320,377 | — | 320,377 | — | ||||||||||||||||||
Noncontrolling interests non-cash acquisition | 37,715 | — | 37,715 | — | 37,715 | (37,715 | ) | |||||||||||||||||
Redeemable noncontrolling interest adjustment to redemption fair value | (16,939 | ) | — | (16,939 | ) | — | (16,939 | ) | 16,939 | |||||||||||||||
Balance as of March 31, 2020 | $ | 2,851,522 | $ | (52,607 | ) | $ | 2,798,915 | $ | 17,002 | $ | 2,815,917 | $ | 23,000 |
Three Months Ended March 31, 2019 | ||||||||||||||||||||||||
Madison Square Garden Sports Corp. Investment | Accumulated Other Comprehensive Loss | Total Company Divisional Equity | Non - redeemable Noncontrolling Interests | Total Divisional Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||
Balance as of December 31, 2018 | $ | 2,616,196 | $ | (43,897 | ) | $ | 2,572,299 | $ | 14,308 | $ | 2,586,607 | $ | 72,770 | |||||||||||
Net loss | (11,929 | ) | — | (11,929 | ) | (680 | ) | (12,609 | ) | (7 | ) | |||||||||||||
Other comprehensive income | — | 6,710 | 6,710 | — | 6,710 | — | ||||||||||||||||||
Comprehensive loss | — | — | (5,219 | ) | (680 | ) | (5,899 | ) | (7 | ) | ||||||||||||||
Net increase in Madison Square Garden Sports Corp. Investment | 53,299 | — | 53,299 | — | 53,299 | — | ||||||||||||||||||
Contribution from noncontrolling interest holders | — | — | — | 3,156 | 3,156 | — | ||||||||||||||||||
Distributions to noncontrolling interest holders | — | — | — | — | — | (1,004 | ) | |||||||||||||||||
Balance as of March 31, 2019 | $ | 2,657,566 | $ | (37,187 | ) | $ | 2,620,379 | $ | 16,784 | $ | 2,637,163 | $ | 71,759 | |||||||||||
See accompanying notes to combined financial statements. |
Three Months Ended September 30, 2021 | ||||||||||||||||||||||||||||||||
Common Stock Issued | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Madison Square Garden Entertainment Corp. Stockholders’ Equity | Non - redeemable Noncontrolling Interests | Total Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||||||||
Balance as of June 30, 2021 | $ | 340 | $ | 2,294,775 | $ | (96,341 | ) | $ | (30,272 | ) | $ | 2,168,502 | $ | 11,904 | $ | 2,180,406 | $ | 137,834 | ||||||||||||||
Net loss | — | — | (79,232 | ) | — | (79,232 | ) | 365 | (78,867 | ) | 2,212 | |||||||||||||||||||||
Other comprehensive loss | — | — | — | (4,788 | ) | (4,788 | ) | — | (4,788 | ) | — | |||||||||||||||||||||
Comprehensive loss | — | — | — | — | (84,020 | ) | 365 | (83,655 | ) | 2,212 | ||||||||||||||||||||||
Share-based compensation | — | 19,692 | — | — | 19,692 | — | 19,692 | — | ||||||||||||||||||||||||
Tax withholding associated with shares issued for equity-based compensation | 2 | (14,905 | ) | — | — | (14,903 | ) | — | (14,903 | ) | — | |||||||||||||||||||||
Adjustment of redeemable noncontrolling interest for change in ownership | — | — | — | — | — | — | — | (7,500 | ) | |||||||||||||||||||||||
Redeemable noncontrolling interest adjustment to redemption fair value | — | (6,178 | ) | — | — | (6,178 | ) | — | (6,178 | ) | 7,566 | |||||||||||||||||||||
Accretion of put options | — | — | — | — | — | — | — | 587 | ||||||||||||||||||||||||
Contributions from noncontrolling interest holders | — | — | — | — | — | 872 | 872 | — | ||||||||||||||||||||||||
Distribution to related parties associated with the settlement of certain share-based awards | — | (227 | ) | — | — | (227 | ) | — | (227 | ) | (289 | ) | ||||||||||||||||||||
Balance as of September 30, 2021 | $ | 342 | $ | 2,293,157 | $ | (175,573 | ) | $ | (35,060 | ) | $ | 2,082,866 | $ | 13,141 | $ | 2,096,007 | $ | 140,410 | ||||||||||||||
MADISON SQUARE GARDEN ENTERTAINMENT CORP. | ||||||||||||||||||||||||
COMBINED STATEMENTS OF DIVISIONAL EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS | ||||||||||||||||||||||||
(Continued) | ||||||||||||||||||||||||
(Unaudited) (in thousands) | ||||||||||||||||||||||||
Nine Months Ended March 31, 2020 | ||||||||||||||||||||||||
Madison Square Garden Sports Corp. Investment | Accumulated Other Comprehensive Loss | Total Company Divisional Equity | Non - redeemable Noncontrolling Interests | Total Divisional Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||
Balance as of June 30, 2019 | $ | 2,618,971 | $ | (46,923 | ) | $ | 2,572,048 | $ | 13,790 | $ | 2,585,838 | $ | 67,627 | |||||||||||
Net income (loss) | (104,741 | ) | — | (104,741 | ) | 38 | (104,703 | ) | (23,851 | ) | ||||||||||||||
Other comprehensive loss | — | (5,684 | ) | (5,684 | ) | — | (5,684 | ) | — | |||||||||||||||
Comprehensive income (loss) | — | — | (110,425 | ) | 38 | (110,387 | ) | (23,851 | ) | |||||||||||||||
Net increase in Madison Square Garden Sports Corp. Investment | 316,516 | — | 316,516 | — | 316,516 | — | ||||||||||||||||||
Contributions from noncontrolling interest holders | — | — | — | 3,709 | 3,709 | — | ||||||||||||||||||
Distributions to noncontrolling interest holders | — | — | — | (535 | ) | (535 | ) | — | ||||||||||||||||
Noncontrolling interest non-cash acquisition | 37,715 | — | 37,715 | — | 37,715 | (37,715 | ) | |||||||||||||||||
Redeemable noncontrolling interest adjustment to redemption fair value | (16,939 | ) | — | (16,939 | ) | — | (16,939 | ) | 16,939 | |||||||||||||||
Balance as of March 31, 2020 | $ | 2,851,522 | $ | (52,607 | ) | $ | 2,798,915 | $ | 17,002 | $ | 2,815,917 | $ | 23,000 |
Nine Months Ended March 31, 2019 | ||||||||||||||||||||||||
Madison Square Garden Sports Corp. Investment | Accumulated Other Comprehensive Loss | Total Company Divisional Equity | Non - redeemable Noncontrolling Interests | Total Divisional Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||
Balance as of June 30, 2018 | $ | 2,525,031 | $ | (46,918 | ) | $ | 2,478,113 | $ | 11,505 | $ | 2,489,618 | $ | 76,684 | |||||||||||
Adoption of ASU No. 2016-01 | (5,570 | ) | 5,570 | — | — | |||||||||||||||||||
Adoption of ASC Topic 606 | 33,669 | — | 33,669 | — | 33,669 | — | ||||||||||||||||||
Net income (loss) | 42,978 | — | 42,978 | (3,121 | ) | 39,857 | (3,662 | ) | ||||||||||||||||
Other comprehensive income | — | 4,161 | 4,161 | — | 4,161 | — | ||||||||||||||||||
Comprehensive income (loss) | — | — | 47,139 | (3,121 | ) | 44,018 | (3,662 | ) | ||||||||||||||||
Net increase in Madison Square Garden Sports Corp. Investment | 61,458 | — | 61,458 | — | 61,458 | — | ||||||||||||||||||
Contributions from noncontrolling interest holders | — | — | — | 8,400 | 8,400 | — | ||||||||||||||||||
Distributions to noncontrolling interest holders | — | — | — | — | — | (1,263 | ) | |||||||||||||||||
Balance as of March 31, 2019 | $ | 2,657,566 | $ | (37,187 | ) | $ | 2,620,379 | $ | 16,784 | $ | 2,637,163 | $ | 71,759 | |||||||||||
See accompanying notes to combined financial statements. |
Three Months Ended September 30, 2020 | ||||||||||||||||||||||||||||||||
Common Stock Issued | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Madison Square Garden Entertainment Corp. Stockholders’ Equity | Non - redeemable Noncontrolling Interests | Total Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||||||||
Balance as of June 30, 2020 | $ | 338 | $ | 2,285,709 | $ | 50,246 | $ | (48,992 | ) | $ | 2,287,301 | $ | 12,203 | $ | 2,299,504 | $ | 20,600 | |||||||||||||||
Cumulative effect of adoption of Accounting Standards Update 2016-13, credit losses | — | — | (480 | ) | — | (480 | ) | — | (480 | ) | — | |||||||||||||||||||||
Reversal of valuation allowance | 2,376 | — | 2,376 | — | 2,376 | — | ||||||||||||||||||||||||||
Net loss | — | — | (35,797 | ) | — | (35,797 | ) | (630 | ) | (36,427 | ) | (3,889 | ) | |||||||||||||||||||
Other comprehensive income | — | — | — | 11,697 | 11,697 | — | 11,697 | — | ||||||||||||||||||||||||
Comprehensive loss | — | — | — | — | (24,100 | ) | (630 | ) | (24,730 | ) | (3,889 | ) | ||||||||||||||||||||
Share-based compensation | — | 16,435 | — | — | 16,435 | — | 16,435 | — | ||||||||||||||||||||||||
Tax withholding associated with shares issued for equity-based compensation | 2 | (8,072 | ) | — | — | (8,070 | ) | — | (8,070 | ) | — | |||||||||||||||||||||
Accretion of put options | — | — | — | — | — | — | — | 587 | ||||||||||||||||||||||||
Contribution from noncontrolling interest holders | — | — | — | — | — | 200 | 200 | — | ||||||||||||||||||||||||
Balance as of September 30, 2020 | $ | 340 | $ | 2,294,072 | $ | 16,345 | $ | (37,295 | ) | $ | 2,273,462 | $ | 11,773 | $ | 2,285,235 | $ | 17,298 | |||||||||||||||
Decrease in net loss attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | 53,758 | ||
Decrease in other comprehensive income | $ | (2,606 | ) | |
Decrease in net loss per common share attributable to Madison Square Garden Entertainment Corp.’s stockholders (basic and diluted) | $ | 2.63 |
Fair Value Recognized as of Acquisition Date (as previously reported) | Measurement Period Adjustment (a) | Fair Value Recognized as of September 30, 2021 as adjusted | ||||||||||
Cash and cash equivalents | $ | 16,737 | $ | — | $ | 16,737 | ||||||
Property and equipment, net | 33,393 | — | 33,393 | |||||||||
Right-of-use | 44,818 | — | 44,818 | |||||||||
Amortizable intangible assets, net | 47,170 | (7,020 | ) | 40,150 | ||||||||
Other assets | 12,641 | — | 12,641 | |||||||||
Accrued expenses and other current liabilities | (15,957 | ) | 1,534 | (14,423 | ) | |||||||
Operating lease liabilities | (52,025 | ) | — | (52,025 | ) | |||||||
Other liabilities | (13,655 | ) | — | (13,655 | ) | |||||||
Total identifiable net assets acquired | 73,122 | (5,486 | ) | 67,636 | ||||||||
Goodwill | 3,378 | (2,014 | ) | 1,364 | ||||||||
Redeemable noncontrolling interests | $ | (76,500 | ) | $ | 7,500 | $ | (69,000 | ) |
(a) | During the three months ended September 30, 2021, the Company recorded an adjustment to reflect a measurement period adjustment. Upon the finalization of the closing statement during the first quarter of Fiscal Year 2022, the noncontrolling interest owned by Hakkasan Parent in Tao Group Sub-Holdings LLC was reduced from approximately18 % as initially estimated to approximately15 %. Such change resulted in a decrease in the Company’s redeemable noncontrolling interest of $7,500, a decrease in Goodwill of $480, and a decrease in amortizable intangibles of approximately $7,020 related to trade names and venue management contracts. Additionally, the Companywrote-off a previously reported accrual of $1,534, which resulted in an additional decrease in Goodwill of $1,534. |
Prepaid expenses | $ | 589 | ||
Other current assets | 381 | |||
Property and equipment, net of accumulated depreciation and amortization | 104,781 | |||
Indefinite-lived intangible assets | 540 | |||
Goodwill | 2,864 | |||
Assets held for sale | 109,155 | |||
Accounts payable and accrued liabilities | 18,444 | |||
Collections due to promoters | 33,715 | |||
Deferred revenue | 18,791 | |||
Other liabilities | 1,861 | |||
Liabilities held for sale | 72,811 | |||
Net assets held for sale | $ | 36,344 |
Beginning balance | $ | 6,449 | ||
Provision for expected credit losses | 437 | |||
Write-offs | (986 | ) | ||
Ending balance | $ | 5,900 | ||
Three Months Ended September 30, 2021 | ||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Eliminations | Total | ||||||||||||||||
Event-related and entertainment dining and nightlife offerings (a) | $ | 22,580 | $ | 0 | $ | 108,690 | $ | (181 | ) | $ | 131,089 | |||||||||
Sponsorship, signage and suite licenses (b) | 7,776 | 636 | 135 | 0 | 8,547 | |||||||||||||||
Media related, primarily from affiliation agreements (c) | 0 | 140,471 | 0 | 0 | 140,471 | |||||||||||||||
Other (d) | 1,567 | 366 | 10,639 | (485 | ) | 12,087 | ||||||||||||||
Total revenues from contracts with customers | $ | 31,923 | $ | 141,473 | $ | 119,464 | $ | (666 | ) | $ | 292,194 | |||||||||
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Event-related and entertainment dining and nightlife offerings (a) | $ | 126,185 | $ | 159,606 | ||||
Sponsorship, signage and suite licenses (b) | 61,800 | 77,897 | ||||||
Other (c) | 11,876 | 12,515 | ||||||
Total revenues from contracts with customers | $ | 199,861 | $ | 250,018 |
Three Months Ended September 30, 2020 | ||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Eliminations | Total | ||||||||||||||||
Event-related and entertainment dining and nightlife offerings (a) | $ | 727 | $ | 0 | $ | 5,660 | $ | 0 | $ | 6,387 | ||||||||||
Sponsorship, signage and suite licenses (b) | 2,460 | 284 | 72 | (232 | ) | 2,584 | ||||||||||||||
Media related, primarily from affiliation agreements (c) | 0 | 156,651 | 0 | 0 | 156,651 | |||||||||||||||
Other (d) | 3,620 | 428 | 1,489 | (1,361 | ) | 4,176 | ||||||||||||||
Total revenues from contracts with customers | $ | 6,807 | $ | 157,363 | $ | 7,221 | $ | (1,593 | ) | $ | 169,798 | |||||||||
Nine Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Event-related and entertainment dining and nightlife offerings (a) | $ | 560,996 | $ | 597,551 | ||||
Sponsorship, signage and suite licenses (b) | 172,368 | 195,652 | ||||||
Other (c) | 33,674 | 39,181 | ||||||
Total revenues from contracts with customers | $ | 767,038 | $ | 832,384 |
(a) | Consists of (i) ticket sales and other ticket-related revenues, (ii) Tao Group Hospitality’s entertainment dining and nightlife offerings, (iii) venue license fees from third-party promoters, and (iv) food, beverage and merchandise sales. Event-related revenues and entertainment dining and nightlife offerings are recognized at a point in time. As such, these revenues have been included in the same category in the table above. |
(b) | See Note 10-K for further details on the pattern of recognition of sponsorship, signage and suite license revenues. |
(c) | See “ — Note 2. Accounting Policies — Summary of Significant Accounting Policies — Revenue Recognition — Media Affiliation Fee and Advertising Revenues for further details on the pattern of recognition of Media affiliation fee and advertising revenues in the MSG Networks segment. |
(d) | Primarily consists of (i) |
Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Ticketing and venue license fee revenues (a) | $ | 47,758 | $ | 66,768 | ||||
Sponsorship and signage, suite, and advertising commission revenues | 69,124 | 87,413 | ||||||
Revenues from entertainment dining and nightlife offerings (b) | 69,103 | 74,140 | ||||||
Food, beverage and merchandise revenues | 11,694 | 17,508 | ||||||
Other (c) | 2,182 | 4,189 | ||||||
Total revenues from contracts with customers | $ | 199,861 | $ | 250,018 |
Nine Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Ticketing and venue license fee revenues (a) | $ | 308,874 | $ | 333,955 | ||||
Sponsorship and signage, suite, and advertising commission revenues | 192,081 | 217,644 | ||||||
Revenues from entertainment dining and nightlife offerings (b) | 191,965 | 190,463 | ||||||
Food, beverage and merchandise revenues | 62,339 | 68,255 | ||||||
Other (c) | 11,779 | 22,067 | ||||||
Total revenues from contracts with customers | $ | 767,038 | $ | 832,384 |
Three Months ended September 30, 2021 | ||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Eliminations | Total | ||||||||||||||||
Ticketing and venue license fee revenues (a) | $ | 16,836 | $ | 0 | $ | 0 | $ | 0 | $ | 16,836 | ||||||||||
Sponsorship and signage, suite, and advertising commission revenues (b) | 10,813 | 0 | 0 | (410 | ) | 10,403 | ||||||||||||||
Revenues from entertainment dining and nightlife offerings (c) | 0 | 0 | 119,464 | (256 | ) | 119,208 | ||||||||||||||
Food, beverage and merchandise revenues | 3,923 | 0 | 0 | 0 | 3,923 | |||||||||||||||
Media networks revenues (d) | 0 | 141,473 | 0 | 0 | 141,473 | |||||||||||||||
Other | 351 | 0 | 0 | 0 | 351 | |||||||||||||||
Total revenues from contracts with customers | $ | 31,923 | $ | 141,473 | $ | 119,464 | $ | (666 | ) | $ | 292,194 | |||||||||
Three Months ended September 30, 2020 | ||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Eliminations | Total | ||||||||||||||||
Ticketing and venue license fee revenues (a) | $ | 730 | $ | 0 | $ | 0 | $ | 0 | $ | 730 | ||||||||||
Sponsorship and signage, suite, and advertising commission revenues (b) | 5,859 | 0 | 0 | (1,427 | ) | 4,432 | ||||||||||||||
Revenues from entertainment dining and nightlife offerings (c) | 0 | 0 | 7,221 | (166 | ) | 7,055 | ||||||||||||||
Food, beverage and merchandise revenues | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Media networks revenues (d) | 0 | 157,363 | 0 | 0 | 157,363 | |||||||||||||||
Other | 218 | 0 | 0 | 0 | 218 | |||||||||||||||
Total revenues from contracts with customers | $ | 6,807 | $ | 157,363 | $ | 7,221 | $ | (1,593 | ) | $ | 169,798 | |||||||||
(a) | Amounts include ticket sales, including other ticket-related revenue, and venue license fees from the Company’s events such as (i) concerts, (ii) the presentation of the Christmas Spectacular, and (iii) other live entertainment and sporting events. |
(b) | Amounts include revenues from sponsorship sales and representation agreements with MSG Sports and advertising commission revenues recognized by the |
(c) | Primarily consist of revenues from (i) entertainment dining and nightlife offerings and (ii) venue management agreements. |
(d) | Primarily consist of affiliation fees from Distributors and, to a lesser extent, advertising revenues |
March 31, | June 30, | |||||||
2020 | 2019 | |||||||
Receivables from contracts with customers, net (a) | $ | 105,222 | $ | 81,170 | ||||
Contract assets, current (b) | 8,164 | 6,873 | ||||||
Deferred revenue, including non-current portion (c) | 212,766 | 197,047 |
September 30, 2021 | June 30, 2021 | |||||||
Receivables from contracts with customers, net (a) | $ | 189,958 | $ | 185,112 | ||||
Contract assets, current (b) | 8,598 | 7,052 | ||||||
Contract assets, non-current (b) | 94 | 87 | ||||||
Deferred revenue, including non-current portion(c) | 266,941 | 210,187 |
(a) | Receivables from contracts with customers, which are reported in Accounts receivable, net and Net related party receivables in the Company’s |
(b) | Contract assets, which are reported as Other current assets or Other assets (non-current portion) in the Company’s |
(c) | Deferred revenue primarily relates to the Company’s receipt of consideration from customers in advance of the Company’s transfer of goods or services to those customers. Deferred revenue is reduced and the related revenue is recognized once the underlying goods or services are transferred to a customer. Revenue recognized for the |
Fiscal Year 2020 (remainder) | $ | 21,317 | ||
Fiscal Year 2021 | 207,045 | |||
Fiscal Year 2022 | 141,696 | |||
Fiscal Year 2023 | 85,300 | |||
Fiscal Year 2024 | 59,141 | |||
Thereafter | 127,529 | |||
$ | 642,028 |
Fiscal Year 2022 (remainder) | $ | 125,176 | ||
Fiscal Year 2023 | 120,864 | |||
Fiscal Year 2024 | 99,307 | |||
Fiscal Year 2025 | 70,132 | |||
Fiscal Year 2026 | 54,383 | |||
Thereafter | 65,865 | |||
$ | 535,727 | |||
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Net loss attributable to Madison Square Garden Entertainment Corp.’s stockholders (numerator): | ||||||||
Net loss attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (79,232 | ) | $ | (35,797 | ) | ||
Weighted-average shares (denominator): | ||||||||
Weighted-average shares for basic and diluted EPS (a) | 34,095 | 34,165 | ||||||
Basic and diluted loss per common share attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (2.32 | ) | $ | (1.05 | ) |
(a) | All restricted stock units and stock options were excluded from the above table because the Company reported a net loss for the periods presented and, therefore, their impact on reported loss per share would have been antidilutive. See Note 15 for further detail. |
As of | ||||||||||||||||
March 31, 2020 | June 30, 2019 | March 31, 2019 | June 30, 2018 | |||||||||||||
Captions on the combined balance sheets: | ||||||||||||||||
Cash and cash equivalents | $ | 1,003,893 | $ | 1,082,055 | $ | 1,151,428 | $ | 1,225,645 | ||||||||
Restricted cash (a) | 17,955 | 10,010 | 8,061 | 6,711 | ||||||||||||
Cash, cash equivalents and restricted cash on the combined statements of cash flows | $ | 1,021,848 | $ | 1,092,065 | $ | 1,159,489 | $ | 1,232,356 |
As of | ||||||||||||||||
September 30, 2021 | June 30, 2021 | September 30, 2020 | June 30, 2020 | |||||||||||||
Captions on the consolidated balance sheets: | ||||||||||||||||
Cash and cash equivalents | $ | 1,331,450 | $ | 1,516,992 | $ | 1,180,159 | $ | 1,103,392 | ||||||||
Restricted cash (a) | 24,029 | 22,984 | 27,807 | 17,749 | ||||||||||||
Cash, cash equivalents and restricted cash on the consolidated statements of cash flows | $ | 1,355,479 | $ | 1,539,976 | $ | 1,207,966 | $ | 1,121,141 | ||||||||
(a) | See Note 2 to the Company’s audited consolidated and combined financial statements and notes thereto for the year ended June 30, 10-K for more information regarding the nature of restricted cash. |
Ownership Percentage | Investment | Loan | Total | ||||||||||||
March 31, 2020 | |||||||||||||||
Equity method investments: | |||||||||||||||
SACO Technologies Inc. (“SACO”) | 30 | % | $ | 40,656 | $ | — | $ | 40,656 | |||||||
Others | 8,007 | — | 8,007 | ||||||||||||
Equity investments without readily determinable fair values (a) | 13,335 | — | 13,335 | ||||||||||||
Total investments and loans to nonconsolidated affiliates | $ | 61,998 | $ | — | $ | 61,998 | |||||||||
June 30, 2019 | |||||||||||||||
Equity method investments: | |||||||||||||||
SACO | 30 | % | $ | 44,321 | $ | — | $ | 44,321 | |||||||
Tribeca Enterprises LLC (“Tribeca Enterprises”) (b) | 50 | % | — | 18,000 | 18,000 | ||||||||||
Others | 8,372 | — | 8,372 | ||||||||||||
Equity investments without readily determinable fair values (a) | 13,867 | — | 13,867 | ||||||||||||
Total investments and loans to nonconsolidated affiliates | $ | 66,560 | $ | 18,000 | $ | 84,560 |
Ownership Percentage | Investment | |||||||
September 30, 2021 | ||||||||
Equity method investments: | ||||||||
SACO Technologies Inc. (“SACO”) | 30 | % | $ | 34,873 | ||||
Others | 6,390 | |||||||
Equity securities without readily determinable fair values (a) | 6,877 | |||||||
Total investments in nonconsolidated affiliates | $ | 48,140 | ||||||
June 30, 2021 | ||||||||
Equity method investments: | ||||||||
SACO | 30 | % | $ | 36,265 | ||||
Others | 6,204 | |||||||
Equity securities without readily determinable fair values (a) | 6,752 | |||||||
Total investments in nonconsolidated affiliates | $ | 49,221 | ||||||
(a) | In accordance with the ASC Topic 321, |
September 30, 2021 | ||||||||||||
Equity Investment with Readily Determinable Fair Values | Shares /Units Held | Cost Basis | Carrying value / Fair value | |||||||||
Townsquare Class A common stock | 583 | $ | 4,221 | $ | 7,621 | |||||||
Townsquare Class C common stock | 2,625 | 19,001 | 34,309 | |||||||||
DraftKings common stock | 869 | 6,036 | 41,874 | |||||||||
Total | $ | 29,258 | $ | 83,804 | ||||||||
June 30, 2021 | ||||||||||||
Equity Investment with Readily Determinable Fair Values | Shares / Units Held | Cost Basis | Carrying value / Fair value | |||||||||
Townsquare Class A common stock | 583 | $ | 4,221 | $ | 7,435 | |||||||
Townsquare Class C common stock | 2,625 | 19,001 | 33,469 | |||||||||
DraftKings common stock | 869 | 6,036 | 45,360 | |||||||||
Total | $ | 29,258 | $ | 86,264 | ||||||||
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Unrealized gain — Townsquare | $ | 1,027 | $ | 610 | ||||
Unrealized gain (loss) — DraftKings | (3,487 | ) | 33,048 | |||||
$ | (2,460 | ) | $ | 33,658 | ||||
March 31, 2020 (a) | June 30, 2019 | |||||||
Land | $ | 141,931 | $ | 167,405 | ||||
Buildings | 992,496 | 1,091,851 | ||||||
Equipment | 329,696 | 318,301 | ||||||
Aircraft | 38,090 | 38,090 | ||||||
Furniture and fixtures | 42,034 | 53,242 | ||||||
Leasehold improvements | 183,033 | 180,111 | ||||||
Construction in progress | 574,876 | 232,390 | ||||||
2,302,156 | 2,081,390 | |||||||
Less accumulated depreciation and amortization(b) | (761,370 | ) | (732,268 | ) | ||||
$ | 1,540,786 | $ | 1,349,122 |
September 30, 2021 | June 30, 2021 | |||||||
Land | $ | 148,468 | $ | 150,750 | ||||
Buildings | 998,811 | 996,295 | ||||||
Equipment | 408,051 | 405,835 | ||||||
Aircraft | 38,090 | 38,090 | ||||||
Furniture and fixtures | 38,299 | 40,660 | ||||||
Leasehold improvements | 225,032 | 214,678 | ||||||
Construction in progress (a) | 1,342,832 | 1,194,525 | ||||||
3,199,583 | 3,040,833 | |||||||
Less accumulated depreciation and amortization | (914,854 | ) | (884,541 | ) | ||||
$ | 2,284,729 | $ | 2,156,292 | |||||
(a) | Interest is capitalized during the construction period for significant long term construction projects. The Company capitalizes interest within the Entertainment segment in connection with the 0 , the |
Line Item in the Company’s Combined Balance Sheet | ||||||
Right-of-use assets: | ||||||
Operating leases | Right-of-use lease assets | $ | 234,760 | |||
Lease liabilities: | ||||||
Operating leases, current | Operating lease liabilities, current | $ | 54,506 | |||
Operating leases, noncurrent | Operating lease liabilities, noncurrent | 191,762 | ||||
Total lease liabilities | $ | 246,268 |
Line Item in the Company’s Consolidated Balance Sheet | September 30, 2021 | June 30, 2021 | ||||||||
Right-of-use | ||||||||||
Operating leases | Right-of-use | $ | 413,463 | $ | 280,579 | |||||
Lease liabilities: | ||||||||||
Operating leases, current | Operating lease liabilities, current | $ | 53,571 | $ | 73,423 | |||||
Operating leases, noncurrent | Operating lease liabilities, noncurrent | 396,569 | 233,556 | |||||||
Total lease liabilities | $ | 450,140 | $ | 306,979 | ||||||
Line Item in the Company’s Combined Statement of Operations | Three Months Ended March 31, 2020 | Nine Months Ended March 31, 2020 | ||||||||
Operating lease cost | Direct operating expenses | $ | 8,090 | $ | 24,397 | |||||
Operating lease cost | Selling, general and administrative expenses | 5,348 | 15,066 | |||||||
Short-term lease cost | Direct operating expenses | — | 348 | |||||||
Variable lease cost | Direct operating expenses | 830 | 3,287 | |||||||
Variable lease cost | Selling, general and administrative expenses | 14 | 40 | |||||||
Total lease cost | $ | 14,282 | $ | 43,138 |
Line Item in the Company’s Consolidated Statement of Operations | Three Months Ended September 30, | |||||||||
2021 | 2020 | |||||||||
Lease cost, operating leases | Direct operating expenses | $ | 11,636 | $ | 6,407 | |||||
Lease cost, operating leases | Selling, general and administrative expenses | 6,421 | 6,493 | |||||||
Variable lease cost | Direct operating expenses | 1,086 | 276 | |||||||
Variable lease cost | Selling, general and administrative expenses | 14 | 23 | |||||||
Total lease cost | $ | 19,157 | $ | 13,199 | ||||||
Fiscal Year 2022 (remainder) | $ | 35,369 | ||
Fiscal Year 2023 | 80,695 | |||
Fiscal Year 2024 | 76,696 | |||
Fiscal Year 2025 | 50,857 | |||
Fiscal Year 2026 | 33,168 | |||
Thereafter | 389,721 | |||
Total lease payments | 666,506 | |||
Less imputed interest | 216,366 | |||
Total lease liabilities | $ | 450,140 | ||
Fiscal Year 2020 (remainder) | $ | 15,587 | ||
Fiscal Year 2021 | 58,204 | |||
Fiscal Year 2022 | 59,101 | |||
Fiscal Year 2023 | 54,872 | |||
Fiscal Year 2024 | 39,735 | |||
Thereafter | 126,222 | |||
Total lease payments | 353,721 | |||
Less imputed interest | 107,453 | |||
Total lease liabilities (a) | $ | 246,268 |
Entertainment | MSG Networks | Tao Group Hospitality | Total | |||||||||||||
Balance as of June 30, 2021 | $ | 74,309 | $ | 424,508 | $ | 3,378 | $ | 502,195 | ||||||||
Measurement period adjustment (a) | 0 | 0 | (2,014 | ) | (2,014 | ) | ||||||||||
Balance as of September 30, 2021 | $ | 74,309 | $ | 424,508 | $ | 1,364 | $ | 500,181 | ||||||||
Balance as of June 30, 2019 | $ | 165,558 | ||
Allocation to the assets held for sale(a) | (2,864 | ) | ||
Goodwill impairment(b) | (80,698 | ) | ||
Balance as of March 31,2020 | $ | 81,996 |
(a) | During the three months ended September 30, 2021, the Company recorded an adjustment to reflect a measurement period adjustment in connection with the |
Sub-Holdings LLC was reduced from approximately 18% as initially estimated to approximately 15%. Such change resulted in a decrease in the Company’s redeemable noncontrolling interest of $7,500, a decrease in Goodwill of $480 as noted above, and a decrease in amortizable intangibles of approximately $7,020 related to trade names and venue management contracts. Additionally, the Companywrote-off a previously reported accrual of $1,534, which resulted in an additional decrease in Goodwill of $1,534. See Note 3 to the Company’s audited consolidated and combined financial statements and notes thereto for the year 10-K regarding the details of the |
Trademarks | Photographic related rights | Total | ||||||||||
Balance as of June 30, 2019 | $ | 62,421 | $ | 3,000 | $ | 65,421 | ||||||
Reclassification to the assets held for sale(a) | (540 | ) | — | (540 | ) | |||||||
Balance as of March 31,2020 | $ | 61,881 | $ | 3,000 | $ | 64,881 |
Trademarks | $ | 61,881 | ||
Photographic related rights | 1,920 | |||
Total | $ | 63,801 | ||
September 30, 2021 | Gross | Accumulated Amortization | Net | |||||||||
Trade names | $ | 113,269 | $ | (26,906 | ) | $ | 86,363 | |||||
Venue management contracts | 85,616 | (19,046 | ) | 66,570 | ||||||||
Affiliate relationships | 83,044 | (57,086 | ) | 25,958 | ||||||||
Non-compete agreements | 9,000 | (7,304 | ) | 1,696 | ||||||||
Festival rights | 8,080 | (2,831 | ) | 5,249 | ||||||||
Other intangibles | 4,217 | (3,884 | ) | 333 | ||||||||
$ | 303,226 | $ | (117,057 | ) | $ | 186,169 | ||||||
June 30, 2021 | Gross | Accumulated Amortization | Net | |||||||||
Trade names | $ | 121,000 | $ | (25,605 | ) | $ | 95,395 | |||||
Venue management contracts | 85,700 | (17,518 | ) | 68,182 | ||||||||
Affiliate relationships | 83,044 | (56,221 | ) | 26,823 | ||||||||
Non-compete agreements | 9,000 | (6,913 | ) | 2,087 | ||||||||
Festival rights | 8,080 | (2,696 | ) | 5,384 | ||||||||
Other intangibles | 4,217 | (3,814 | ) | 403 | ||||||||
$ | 311,041 | $ | (112,767 | ) | $ | 198,274 | ||||||
March 31, 2020 | Gross | Accumulated Amortization | Net | |||||||||
Trade names(a) | $ | 97,530 | $ | (18,522 | ) | $ | 79,008 | |||||
Venue management contracts | 79,000 | (13,310 | ) | 65,690 | ||||||||
Favorable lease assets (b) | — | — | — | |||||||||
Non-compete agreements | 9,000 | (4,565 | ) | 4,435 | ||||||||
Festival rights | 8,080 | (2,020 | ) | 6,060 | ||||||||
Other intangibles(c) | 4,217 | (3,462 | ) | 755 | ||||||||
$ | 197,827 | $ | (41,879 | ) | $ | 155,948 |
June 30, 2019 | Gross | Accumulated Amortization | Net | |||||||||
Trade names(a) | $ | 98,530 | $ | (11,346 | ) | $ | 87,184 | |||||
Venue management contracts | 79,000 | (9,887 | ) | 69,113 | ||||||||
Favorable lease assets (b) | 54,253 | (10,382 | ) | 43,871 | ||||||||
Non-compete agreements | 9,000 | (3,391 | ) | 5,609 | ||||||||
Festival rights | 8,080 | (1,617 | ) | 6,463 | ||||||||
Other intangibles(c) | 6,717 | (4,566 | ) | 2,151 | ||||||||
$ | 255,580 | $ | (41,189 | ) | $ | 214,391 |
Fiscal Year 2022 | $ | 276,707 | ||
Fiscal Year 2023 | 273,370 | |||
Fiscal Year 2024 | 253,485 | |||
Fiscal Year 2025 | 246,013 | |||
Fiscal Year 2026 | 249,584 | |||
Thereafter | 2,347,091 | |||
$ | 3,646,250 | |||
Fair Value Hierarchy | March 31, 2020 | June 30, 2019 | ||||||||
Assets: | ||||||||||
Commercial Paper | I | $ | — | $ | 169,707 | |||||
Money market accounts | I | — | 101,517 | |||||||
Time deposits | I | 67,761 | 789,833 | |||||||
U.S. treasury bills | I | 999,542 | — | |||||||
Equity investment with readily determinable fair value | I | 14,790 | 17,260 | |||||||
Total assets measured at fair value | $ | 1,082,093 | $ | 1,078,317 |
Line Item on Consolidated Balance Sheet | September 30, 2021 | June 30, 2021 | ||||||||
Assets: | ||||||||||
Money market accounts and time deposits (a) | Cash and cash equivalents | $ | 1,166,105 | $ | 1,361,729 | |||||
Equity investments with readily determinable fair value (b) | Other assets | 83,804 | 86,264 | |||||||
Total assets measured at fair value | $ | 1,249,909 | $ | 1,447,993 | ||||||
(a) | The carrying amount of the Company’s cash equivalents in money market accounts and time deposits approximate fair value due to their short-term maturities. |
(b) | See Note 7 for more information on the Company’s equity investments with readily determinable fair value in Townsquare and DraftKings. |
March 31, 2020 | June 30, 2019 | |||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Assets | ||||||||||||||||
Notes receivable (a) | $ | 12,566 | $ | 12,566 | $ | 13,348 | $ | 13,348 | ||||||||
Short-term investments (a) | 331,019 | 331,019 | 108,416 | 108,416 | ||||||||||||
Equity investment with readily determinable fair value (b) | 14,790 | 14,790 | 17,260 | 17,260 | ||||||||||||
Subordinated term loan receivable (c) | — | — | 58,735 | 57,711 | ||||||||||||
Liabilities | ||||||||||||||||
Long-term debt, including current portion (d) | $ | 35,000 | $ | 31,310 | $ | 55,000 | $ | 54,883 |
September 30, 2021 | June 30, 2021 | |||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Liabilities | ||||||||||||||||
Current and non-current portion of long-term debt under the MSG Networks Term Loan Facility(a) | $ | 1,035,375 | $ | 1,030,200 | $ | 1,047,750 | $ | 1,042,510 | ||||||||
Current and non-current portion of long-term debt under the National Properties Term Loan Facility(a) | $ | 645,125 | $ | 662,866 | $ | 646,750 | $ | 669,386 | ||||||||
Current and non-current portion of long-term debt under the Tao Credit Facilities(a) | $ | 27,500 | $ | 27,599 | $ | 43,750 | $ | 43,851 |
(a) |
On October 11, 2019, MSGN Holdings L.P., certain MSGN Holdings L.P. subsidiaries and certain MSG Networks Inc. subsidiaries entered into an amended and restated credit facility consisting of 1,100,000 five-year term loan facility and |
facility. On May 23, 2019, Tao Group Intermediate Holdings LLC and Tao Group Operating LLC entered into a $40,000 five-year term loan facility and a $25,000 five-year term revolving facility. In November 2020, MSG National Properties and certain subsidiaries of the Company entered into the National Properties Term Loan Facility, providing a five-year $650,000 term loan facility. The Company’s long-term debt is classified within Level II of the fair value hierarchy as it is valued using quoted indices of similar securities for which the inputs are readily observable. See Note |
The following table provides a reconciliation of the deferred and contingent consideration liabilities in connection with the acquisitions discussed above: | ||||
Nine Months Ended March 31, 2020 | ||||
Balance as of June 30, 2019 | $ | 1,210 | ||
Change in fair value of contingent consideration(a) | (1,210 | ) | ||
Balance as of March 31, 2020 | $ | — |
MSG Networks Senior Secured Credit Facilities | National Properties Term Loan Facility | Tao Credit Facilities | Total | |||||||||||||
Fiscal Year 2022 (remainder) | $ | 37,125 | 4,875 | $ | 5,000 | $ | 47,000 | |||||||||
Fiscal Year 2023 | 66,000 | 6,500 | 10,000 | 82,500 | ||||||||||||
Fiscal Year 2024 | 82,500 | 6,500 | 12,500 | 101,500 | ||||||||||||
Fiscal Year 2025 | 849,750 | 6,500 | 0 | 856,250 | ||||||||||||
Fiscal Year 2026 | 0 | 620,750 | 0 | 620,750 | ||||||||||||
Thereafter | 0 | 0 | 0 | 0 | ||||||||||||
$ | 1,035,375 | $ | 645,125 | $ | 27,500 | $ | 1,708,000 | |||||||||
March 31, 2020 | ||||||||||||
Tao Term Loan Facility | Deferred Financing Costs | Total | ||||||||||
Current portion of long-term debt, net of deferred financing costs | $ | 5,000 | $ | (208 | ) | $ | 4,792 | |||||
Long-term debt, net of deferred financing costs (a) | 30,000 | (675 | ) | 29,325 | ||||||||
Total | $ | 35,000 | $ | (883 | ) | $ | 34,117 | |||||
September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||
Principal | Unamortized Deferred Financing Costs | Net (a) | Principal | Unamortized Deferred Financing Costs | Net (a) | |||||||||||||||||||
Current portion | ||||||||||||||||||||||||
MSG Networks Senior Secured Credit Facilities | $ | 49,500 | $ | (1,250 | ) | $ | 48,250 | $ | 49,500 | $ | (1,255 | ) | $ | 48,245 | ||||||||||
National Properties Term Loan Facility | 6,500 | (6,783 | ) | (283 | ) | 6,500 | (6,783 | ) | (283 | ) | ||||||||||||||
Tao Credit Facilities | 7,500 | (239 | ) | 7,261 | 6,250 | (239 | ) | 6,011 | ||||||||||||||||
Current portion of long-term debt, net of deferred financing costs (a) | $ | 63,500 | $ | (8,272 | ) | $ | 55,228 | $ | 62,250 | $ | (8,277 | ) | $ | 53,973 | ||||||||||
June 30, 2019 | ||||||||||||
Tao Term Loan Facility | Deferred Financing Costs | Total | ||||||||||
Current portion of long-term debt, net of deferred financing costs | $ | 6,250 | $ | (208 | ) | $ | 6,042 | |||||
Long-term debt, net of deferred financing costs (a) | 33,750 | (831 | ) | 32,919 | ||||||||
Total | $ | 40,000 | $ | (1,039 | ) | $ | 38,961 |
September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||
Principal | Unamortized Deferred Financing Costs | Net (a) | Principal | Unamortized Deferred Financing Costs | Net (a) | |||||||||||||||||||
Noncurrent portion | ||||||||||||||||||||||||
MSG Networks Senior Secured Credit Facilities | $ | 985,875 | $ | (2,405 | ) | $ | 983,470 | $ | 998,250 | $ | (2,715 | ) | $ | 995,535 | ||||||||||
National Properties Term Loan Facility | 638,625 | (21,123 | ) | 617,502 | 640,250 | (22,819 | ) | 617,431 | ||||||||||||||||
Tao Credit Facilities | 20,000 | (416 | ) | 19,584 | 22,500 | (475 | ) | 22,025 | ||||||||||||||||
Tao Revolving Credit Facility (b) | 0 | 0 | 0 | 15,000 | 0 | 15,000 | ||||||||||||||||||
Long-term debt, net of deferred financing costs | $ | 1,644,500 | $ | (23,944 | ) | $ | 1,620,556 | $ | 1,676,000 | $ | (26,009 | ) | $ | 1,649,991 | ||||||||||
(a) | In addition to the outstanding balance associated with the MSG Networks Senior Secured Credit Facilities, the Tao Term Loan Facility, the Tao Revolving Credit Facility and the National Properties Term Loan Facility disclosed above, the Company’s |
(b) | Unamortized deferred financing costs associated with MSGN Revolving Credit Facility and |
March 31, 2020 | June 30, 2019 | |||||||
Other current assets | $ | 85 | $ | 85 | ||||
Other assets | 269 | 333 |
Interest Payments | Loan Principal Repayments | |||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
September 30, 2021 | September 30, 2020 | September 30, 2021 | September 30, 2020 | |||||||||||||
MSG Networks Senior Secured Credit Facilities | $ | 4,427 | $ | 4,782 | $ | 12,375 | $ | 6,875 | ||||||||
National Properties Term Loan Facility | 11,585 | 0 | 1,625 | 0 | ||||||||||||
Tao Credit Facilities | 241 | 334 | 16,250 | 1,250 | ||||||||||||
$ | 16,253 | $ | 5,116 | $ | 30,250 | $ | 8,125 | |||||||||
Pension Plans | Postretirement Plan | |||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Service cost | $ | 24 | $ | 20 | $ | 18 | $ | 28 | ||||||||
Interest cost | 1,326 | 1,473 | 28 | 58 | ||||||||||||
Expected return on plan assets | (1,330 | ) | (781 | ) | — | — | ||||||||||
Recognized actuarial loss | 339 | 318 | 3 | 10 | ||||||||||||
Settlement loss recognized | 67 | — | — | — | ||||||||||||
Amortization of unrecognized prior service credit | — | — | — | (1 | ) | |||||||||||
Net periodic benefit cost | $ | 426 | $ | 1,030 | $ | 49 | $ | 95 | ||||||||
Contributory charge to Madison Square Garden Sports Corp. for participation in the Shared Plans and allocation of costs related to the corporate employees (a) | (62 | ) | (171 | ) | (8 | ) | (17 | ) | ||||||||
Net periodic benefit cost reported in combined statements of operations | $ | 364 | $ | 859 | $ | 41 | $ | 78 |
Pension Plans | Postretirement Plan | |||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Service cost | $ | 72 | $ | 60 | $ | 53 | $ | 83 | ||||||||
Interest cost | 3,982 | 4,419 | 83 | 173 | ||||||||||||
Expected return on plan assets | (3,989 | ) | (2,344 | ) | — | — | ||||||||||
Recognized actuarial loss | 1,019 | 954 | 8 | 30 | ||||||||||||
Settlement loss recognized | 67 | — | — | — | ||||||||||||
Amortization of unrecognized prior service credit | — | — | — | (4 | ) | |||||||||||
Net periodic benefit cost | $ | 1,151 | $ | 3,089 | $ | 144 | $ | 282 | ||||||||
Contributory charge to Madison Square Garden Sports Corp. for participation in the Shared Plans and allocation of costs related to the corporate employees (a) | (164 | ) | (515 | ) | (25 | ) | (50 | ) | ||||||||
Net periodic benefit cost reported in combined statements of operations | $ | 987 | $ | 2,574 | $ | 119 | $ | 232 |
Pension Plans | Postretirement Plans | |||||||||||||||
Three Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Service cost | $ | 118 | $ | 121 | $ | 16 | $ | 22 | ||||||||
Interest cost | 1,190 | 1,102 | 20 | 19 | ||||||||||||
Expected return on plan assets | (1,719 | ) | (1,509 | ) | 0 | 0 | ||||||||||
Recognized actuarial loss | 501 | 458 | 9 | 0 | ||||||||||||
Net periodic (benefit) cost | $ | 90 | $ | 172 | $ | 45 | $ | 41 |
Savings Plans (a) | Union Savings Plan | |||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
March 31, | March 31, | March 31, | March 31, | |||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
$ | (1,307 | ) | $ | 1,854 | $ | 3,288 | $ | 5,945 | $ | 469 | $ | 450 | $ | 522 | $ | 498 |
Savings Plans | Union Savings Plan | |||||
Three Months Ended | Three Months Ended | |||||
September 30, | September 30, | |||||
2021 | 2020 | 2021 | 2020 | |||
$2,019 | $1,405 | $14 | $9 |
Number of | Weighted-Average Fair Value Per Share at Date of Grant | ||||||||
Nonperformance Based Vesting RSUs | Performance Based Vesting RSUs | ||||||||
Unvested award balance, June 30, 2019 | 215 | 354 | $ | 252.51 | |||||
Granted (a) | 112 | 112 | $ | 246.51 | |||||
Vested | (97 | ) | (119 | ) | $ | 212.66 | |||
Forfeited | (10 | ) | (17 | ) | $ | 257.93 | |||
Unvested award balance, March 31, 2020 | 220 | 330 | $ | 265.47 |
Number of | Weighted-Average Fair Value Per Share at Date of Grant | |||||||||||
Nonperformance Based Vesting RSUs (In Thousands) | Performance Based Vesting RSUs (In Thousands) | |||||||||||
Unvested award balance, June 30, 2021 | 683 | 701 | $ | 76.15 | ||||||||
Granted | 445 | 422 | $ | 79.07 | ||||||||
Performance Award Conversion | 223 | (223 | ) | $ | 82.63 | |||||||
Vested | (326 | ) | (77 | ) | $ | 87.67 | ||||||
Forfeited | (1 | ) | (4 | ) | $ | 75.47 | ||||||
Unvested award balance, September 30, 2021 | 1,024 | 819 | $ | 75.01 | ||||||||
Number of Time Vesting Options | Weighted-Average Exercise Price Per Share | Weighted-Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value | |||||||||
Balance as of June 30, 2019 | 543 | $ | 325.47 | |||||||||
Granted | — | $ | — | |||||||||
Balance as of March 31, 2020 | 543 | $ | 325.47 | 6.31 | $ | 120 | ||||||
Exercisable as of March 31, 2020 | 175 | $ | 299.67 | 6.62 | $ | 80 |
Number of Time Vesting Options (In Thousands) | Number of Performance Based Vesting Options (In Thousands) | Weighted- Average Exercise Price Per Share | Weighted- Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value (In Thousands) | ||||||||||||||||
Balance as of June 30, 2021 | 409 | 315 | $ | 103.88 | ||||||||||||||||
Performance Award Conversion | 315 | (315 | ) | $ | 109.76 | |||||||||||||||
Balance as of September 30, 2021 | 724 | — | $ | 103.88 | 4.21 | $ | 780 | |||||||||||||
Exercisable as of September 30, 2021 | 597 | 0 | $ | 108.29 | 3.95 | $ | 780 |
Three Months Ended March 31, 2020 | |||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Accumulated Other Comprehensive Loss | |||||||||
Balance as of December 31, 2019 | $ | (41,395 | ) | $ | 8,325 | $ | (33,070 | ) | |||
Other comprehensive loss before reclassifications | — | (19,946 | ) | (19,946 | ) | ||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 409 | — | 409 | ||||||||
Other comprehensive income (loss) | 409 | (19,946 | ) | (19,537 | ) | ||||||
Balance as of March 31, 2020 | $ | (40,986 | ) | $ | (11,621 | ) | $ | (52,607 | ) |
Three Months Ended March 31, 2019 | |||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Accumulated Other Comprehensive Loss | |||||||||
Balance as of December 31, 2018 | $ | (40,193 | ) | $ | (3,704 | ) | $ | (43,897 | ) | ||
Other comprehensive income before reclassifications | — | 6,383 | 6,383 | ||||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 327 | — | 327 | ||||||||
Other comprehensive income | 327 | 6,383 | 6,710 | ||||||||
Balance as of March 31, 2019 | $ | (39,866 | ) | $ | 2,679 | $ | (37,187 | ) |
Three Months Ended September 30, 2021 | ||||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Accumulated Other Comprehensive Loss | ||||||||||
Balance as of June 30, 2021 | $ | (45,425 | ) | $ | 15,153 | $ | (30,272 | ) | ||||
Other comprehensive income (loss) before reclassifications | — | (6,418 | ) | (6,418 | ) | |||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 510 | 0 | 510 | |||||||||
Income tax benefit (expense) | (94 | ) | 1,214 | 1,120 | ||||||||
Other comprehensive income (loss) | 416 | (5,204 | ) | (4,788 | ) | |||||||
Balance as of September 30, 2021 | $ | (45,009 | ) | $ | 9,949 | $ | (35,060 | ) | ||||
Three Months Ended September 30, 2020 | ||||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Accumulated Other Comprehensive Loss | ||||||||||
Balance as of June 30, 2020 | $ | (38,767 | ) | $ | (10,225 | ) | $ | (48,992 | ) | |||
Other comprehensive income before reclassifications | — | 13,951 | 13,951 | |||||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 478 | 0 | 478 | |||||||||
Income tax expense | (163 | ) | (2,569 | ) | (2,732 | ) | ||||||
Other comprehensive income | 315 | 11,382 | 11,697 | |||||||||
Balance as of September 30, 2020 | $ | (38,452 | ) | $ | 1,157 | $ | (37,295 | ) | ||||
Nine Months Ended March 31, 2020 | |||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Accumulated Other Comprehensive Loss | |||||||||
Balance as of June 30, 2019 | $ | (42,080 | ) | $ | (4,843 | ) | $ | (46,923 | ) | ||
Other comprehensive loss before reclassifications | — | (6,778 | ) | (6,778 | ) | ||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 1,094 | — | 1,094 | ||||||||
Other comprehensive income (loss) | 1,094 | (6,778 | ) | (5,684 | ) | ||||||
Balance as of March 31, 2020 | $ | (40,986 | ) | $ | (11,621 | ) | $ | (52,607 | ) |
Nine Months Ended March 31, 2019 | |||||||||||||||
Pension Plans and Postretirement Plan | Cumulative Translation Adjustments | Unrealized Gain (Loss) on Available-for-sale Securities (b) | Accumulated Other Comprehensive Loss | ||||||||||||
Balance as of June 30, 2018 | $ | (40,846 | ) | $ | (502 | ) | $ | (5,570 | ) | $ | (46,918 | ) | |||
Reclassification of unrealized loss on available-for-sale securities | — | — | 5,570 | 5,570 | |||||||||||
Other comprehensive income before reclassifications | — | 3,181 | — | 3,181 | |||||||||||
Amounts reclassified from accumulated other comprehensive loss (a) | 980 | — | — | 980 | |||||||||||
Other comprehensive income | 980 | 3,181 | — | 4,161 | |||||||||||
Balance as of March 31, 2019 | $ | (39,866 | ) | $ | 2,679 | $ | — | $ | (37,187 | ) |
(a) | Amounts reclassified from accumulated other comprehensive loss represent the amortization of net actuarial loss and net unrecognized prior service credit included in net periodic benefit cost, which is reflected under Miscellaneous income (expense), net in the accompanying |
Three Months Ended March 31, | Nine Months Ended March 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues | $ | 6,333 | $ | 7,906 | $ | 13,792 | $ | 15,762 | ||||||||
Operating expenses (credits): | ||||||||||||||||
Revenue sharing expenses | $ | 42,878 | $ | 55,756 | $ | 108,380 | $ | 124,949 | ||||||||
Allocation of charges for venue usage to Madison Square Garden Sports Corp. | (26,355 | ) | (21,694 | ) | (48,459 | ) | (44,447 | ) | ||||||||
Corporate general and administrative expenses, net — Madison Square Garden Sports Corp. | (32,672 | ) | (30,716 | ) | (96,485 | ) | (85,196 | ) | ||||||||
Corporate general and administrative expenses, net — MSG Networks | (2,672 | ) | (2,514 | ) | (7,876 | ) | (7,790 | ) | ||||||||
Consulting fees | — | — | — | 1,792 | ||||||||||||
Advertising expenses | 316 | 403 | 460 | 749 | ||||||||||||
Other operating expenses, net | 174 | (49 | ) | 297 | (38 | ) |
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Revenues | $ | 4,187 | $ | 2,823 | ||||
Operating expenses (credits): | ||||||||
Direct operating — media rights fees | $ | 40,445 | $ | 39,541 | ||||
Direct operating — revenue sharing expenses | 854 | 81 | ||||||
Direct operating — reimbursement under Arena License Arrangement | (340 | ) | (890 | ) | ||||
Direct operating and general and administrative — net credits with MSG Sports | (9,216 | ) | (10,180 | ) | ||||
Direct operating — origination, master control and technical services | 1,208 | 1,184 | ||||||
Other operating expenses, net | 2,122 | 133 |
Three Months Ended September 30, 2021 | ||||||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Purchase accounting adjustments | Inter-segment eliminations | Total | |||||||||||||||||||
Revenues | $ | 34,239 | $ | 141,473 | $ | 119,464 | $ | 0 | $ | (666 | ) | $ | 294,510 | |||||||||||
Direct operating expenses | 36,302 | 68,423 | 61,093 | 85 | (142 | ) | 165,761 | |||||||||||||||||
Selling, general and administrative expenses | 92,962 | 47,975 | 34,094 | 0 | (192 | ) | 174,839 | |||||||||||||||||
Depreciation and amortization | 19,656 | 1,797 | 6,378 | 1,599 | 0 | 29,430 | ||||||||||||||||||
Impairment of long-lived assets | 0 | 0 | 7,818 | 0 | 0 | 7,818 | ||||||||||||||||||
Operating income (loss) | $ | (114,681 | ) | $ | 23,278 | $ | 10,081 | $ | (1,684 | ) | $ | (332 | ) | $ | (83,338 | ) | ||||||||
Loss in equity method investments | (1,207 | ) | ||||||||||||||||||||||
Interest income | 775 | |||||||||||||||||||||||
Interest expense | (9,248 | ) | ||||||||||||||||||||||
Miscellaneous expense, net (a) | (2,547 | ) | ||||||||||||||||||||||
Loss from operations before income taxes | $ | (95,565 | ) | |||||||||||||||||||||
Reconciliation of operating loss to adjusted operating income: | ||||||||||||||||||||||||
Operating income (loss) | $ | (114,681 | ) | $ | 23,278 | $ | 10,081 | $ | (1,684 | ) | $ | (332 | ) | $ | (83,338 | ) | ||||||||
Add back: | ||||||||||||||||||||||||
Non-cash portion of arena license fees from MSG Sports | (543 | ) | 0 | 0 | 0 | 0 | (543 | ) | ||||||||||||||||
Share-based compensation | 10,143 | 7,474 | 1,911 | 0 | 0 | 19,528 | ||||||||||||||||||
Depreciation and amortization | 19,656 | 1,797 | 6,378 | 1,599 | 0 | 29,430 | ||||||||||||||||||
Amortization for capitalized cloud computing arrangement costs | 41 | 44 | 0 | 0 | 0 | 85 | ||||||||||||||||||
Merger and acquisition related costs | 13,992 | 23,200 | 0 | 0 | 0 | 37,192 | ||||||||||||||||||
Impairment of long-lived assets | — | — | 7,818 | — | — | 7,818 | ||||||||||||||||||
Other purchase accounting adjustments | 0 | 0 | 0 | 85 | 0 | 85 | ||||||||||||||||||
Adjusted operating income (loss) | $ | (71,392 | ) | $ | 55,793 | $ | 26,188 | $ | 0 | $ | (332 | ) | $ | 10,257 | ||||||||||
Other information: | ||||||||||||||||||||||||
Capital expenditures | $ | 133,538 | $ | 1,449 | $ | 2,284 | $ | 0 | $ | 0 | $ | 137,271 |
Three Months Ended September 30, 2020 | ||||||||||||||||||||||||
Entertainment | MSG Networks | Tao Group Hospitality | Purchase accounting adjustments | Inter-segment eliminations | Total | |||||||||||||||||||
Revenues | $ | 7,555 | $ | 157,363 | $ | 7,221 | $ | 0 | $ | (1,593 | ) | $ | 170,546 | |||||||||||
Direct operating expenses | 23,615 | 65,072 | 9,828 | 924 | (208 | ) | 99,231 | |||||||||||||||||
Selling, general and administrative expenses | 52,650 | 22,527 | 7,603 | 0 | (1,123 | ) | 81,657 | |||||||||||||||||
Depreciation and amortization | 22,014 | 1,828 | 1,046 | 3,522 | 0 | 28,410 | ||||||||||||||||||
Restructuring charges | 19,927 | 0 | 0 | 0 | 0 | 19,927 | ||||||||||||||||||
Operating income (loss) | $ | (110,651 | ) | $ | 67,936 | $ | (11,256 | ) | $ | (4,446 | ) | $ | (262 | ) | $ | (58,679 | ) | |||||||
Loss in equity method investments | (1,696 | ) | ||||||||||||||||||||||
Interest income | 772 | |||||||||||||||||||||||
Interest expense | (5,273 | ) | ||||||||||||||||||||||
Miscellaneous income, net (a) | 34,017 | |||||||||||||||||||||||
Loss from operations before income taxes | $ | (30,859 | ) | |||||||||||||||||||||
Reconciliation of operating loss to adjusted operating loss: | ||||||||||||||||||||||||
Operating income (loss) | $ | (110,651 | ) | $ | 67,936 | $ | (11,256 | ) | $ | (4,446 | ) | $ | (262 | ) | $ | (58,679 | ) | |||||||
Add back: | ||||||||||||||||||||||||
Share-based compensation | 10,433 | 4,627 | 1,096 | 0 | 0 | 16,156 | ||||||||||||||||||
Depreciation and amortization | 22,014 | 1,828 | 1,046 | 3,522 | 0 | 28,410 | ||||||||||||||||||
Restructuring charges | 19,927 | 0 | 0 | 0 | 0 | 19,927 | ||||||||||||||||||
Other purchase accounting adjustments | 0 | 0 | 0 | 924 | 0 | 924 | ||||||||||||||||||
Adjusted operating income (loss) | $ | (58,277 | ) | $ | 74,391 | $ | (9,114 | ) | $ | 0 | $ | (262 | ) | $ | 6,738 | |||||||||
Other information: | ||||||||||||||||||||||||
Capital expenditures | $ | 111,399 | $ | 1,741 | $ | 659 | $ | 0 | $ | 0 | $ | 113,799 |
(a) | Miscellaneous income (expense), net includes the following: |
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Unrealized gain (loss) on equity investments with readily determinable fair value, see Note 7 for further details. | $ | (2,460 | ) | $ | 33,658 | |||
Non-service cost components of net periodic pension and postretirement benefit costs | (8 | ) | (91 | ) | ||||
Others, net | (79 | ) | 450 | |||||
Total | $ | (2,547 | ) | $ | 34,017 | |||
September 30, 2021 | June 30, 2021 | |||||||
Customer A | 16 | % | 16 | % | ||||
Customer B | 16 | % | 15 | % | ||||
Customer C | 13 | % | 17 | % |
Three Months Ended | ||||||||
September 30, 2021 | September 30, 2020 | |||||||
Customer 1 | 15 | % | 26 | % | ||||
Customer 2 | 13 | % | 24 | % | ||||
Customer 3 | 10 | % | 19 | % |
September 30, 2021 | June 30, 2021 | |||||||
Prepaid expenses | $ | 700 | $ | 1,400 | ||||
Other current assets | 3,700 | 3,700 | ||||||
Other assets | 30,400 | 31,100 | ||||||
$ | 34,800 | $ | 36,200 | |||||
September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||
As Previously Issued | Adjustment | As Revised | As Previously Issued | Adjustment | As Revised | |||||||||||||||||||
Property and equipment, net | $ | 2,226,175 | $ | 58,554 | $ | 2,284,729 | $ | 2,107,064 | $ | 49,228 | $ | 2,156,292 | ||||||||||||
Total assets | 5,279,366 | 58,554 | 5,337,920 | 5,240,651 | 49,228 | 5,289,879 | ||||||||||||||||||
Deferred tax liabilities, net | 167,180 | 10,601 | 177,781 | 191,429 | 8,896 | 200,325 | ||||||||||||||||||
Total liabilities | 3,090,902 | 10,601 | 3,101,503 | 2,962,743 | 8,896 | 2,971,639 | ||||||||||||||||||
Additional paid-in capital | 2,279,180 | 13,977 | 2,293,157 | 2,280,798 | 13,977 | 2,294,775 | ||||||||||||||||||
Accumulated deficit | (209,549 | ) | 33,976 | (175,573 | ) | (122,696 | ) | 26,355 | (96,341 | )) | ||||||||||||||
Total Madison Square Garden Entertainment Corp. stockholders’ equity | 2,034,913 | 47,953 | 2,082,866 | 2,128,170 | 40,332 | 2,168,502 | ||||||||||||||||||
Total equity | 2,048,054 | 47,953 | 2,096,007 | 2,140,074 | 40,332 | 2,180,406 | ||||||||||||||||||
Total liabilities, redeemable noncontrolling interests and equity | 5,279,366 | 58,554 | 5,337,920 | 5,240,651 | 49,228 | 5,289,879 |
September 30, 2021 | September 30, 2020 | |||||||||||||||||||||||
(in thousands) | As Previously Issued | Adjustment | As Revised | As Previously Issued | Adjustment | As Revised | ||||||||||||||||||
Interest expense | $ | (18,574 | ) | $ | 9,326 | $ | (9,248 | ) | $ | (5,628 | ) | $ | 355 | $ | (5,273 | ) | ||||||||
Loss from operations before income taxes | (104,891 | ) | 9,326 | (95,565 | ) | (31,214 | ) | 355 | (30,859 | ) | ||||||||||||||
Income tax benefit (expense) | 20,615 | (1,705 | ) | 18,910 | (9,392 | ) | (65 | ) | (9,457 | ) | ||||||||||||||
Net loss | (84,276 | ) | 7,621 | (76,655 | ) | (40,606 | ) | 290 | (40,316 | ) | ||||||||||||||
Net income (loss) attributable to Madison Square Garden Entertainment Corp.’s stockholders | (86,853 | ) | 7,621 | (79,232 | ) | (36,087 | ) | 290 | (35,797 | ) | ||||||||||||||
Basic and diluted loss per common share attributable to Madison Square Garden Entertainment Corp.’s stockholders | (2.55 | ) | 0.22 | (2.32 | ) | (1.06 | ) | 0.01 | (1.05 | ) |
September 30, 2021 | September 30, 2020 | |||||||||||||||||||||||
(in thousands) | As Previously Issued | Adjustment | As Revised | As Previously Issued | Adjustment | As Revised | ||||||||||||||||||
Net loss | $ | (84,276 | ) | $ | 7,621 | $ | (76,655 | ) | $ | (40,606 | ) | $ | 290 | $ | (40,316 | ) | ||||||||
Comprehensive loss | (89,064 | ) | 7,621 | (81,443 | ) | (28,909 | ) | 290 | (28,619 | ) | ||||||||||||||
Comprehensive income (loss) attributable to Madison Square Garden Entertainment Corp.’s stockholders | (91,641 | ) | 7,621 | (84,020 | ) | (24,390 | ) | 290 | (24,100 | ) |
September 30, 2021 | September 30, 2020 | |||||||||||||||||||||||
(in thousands) | As Previously Issued | Adjustment | As Revised | As Previously Issued | Adjustment | As Revised | ||||||||||||||||||
Net loss | $ | (84,276 | ) | $ | 7,621 | $ | (76,655 | ) | $ | (40,606 | ) | $ | 290 | $ | (40,316 | ) | ||||||||
Benefit from deferred income taxes | (21,741 | ) | 1,705 | (20,036 | ) | (9,655 | ) | 65 | (9,590 | ) | ||||||||||||||
Net cash provided by (used in) operating activities | (2,338 | ) | 9,326 | 6,988 | (95,582 | ) | 355 | (95,227 | ) | |||||||||||||||
Capitalized interest | 0 | (9,326 | ) | (9,326 | ) | 0 | (355 | ) | (355 | ) | ||||||||||||||
Net cash used in investing activities | (136,976 | ) | (9,326 | ) | (146,302 | ) | 192,589 | (355 | ) | 192,234 |
the level of our revenues, which depends in part on the popularity of the Christmas Spectacular the demand for our MSG Networks programming among cable, satellite, telephone and other platforms (“Distributors”) and the subscribers thereto, and our ability to enter into and renew affiliation agreements with Distributors, or to do so on favorable terms, as well as the impact of consolidation among Distributors; the ability of our Distributors to maintain, or minimize declines in, subscriber levels; the impact of subscribers selecting Distributors’ packages that do not include our networks or Distributors that do not carry our networks at all; the security of our MSG Networks program signal and electronic data; the on-ice andon-court performance of the professional sports teams whose games we broadcast on our networks and host in our venues;52 |
Three Months Ended March 31, 2019 | Nine Months Ended March 31, 2019 | |||||||
Renewal of a Ticketing Agreement | $ | 4,000 | $ | 2,000 |
Three Months Ended September 30, | Change | |||||||||||||||
2021 | 2020 | Amount | Percentage | |||||||||||||
Revenues | $ | 294,510 | $ | 170,546 | $ | 123,964 | 73 | % | ||||||||
Direct operating expenses | 165,761 | 99,231 | 66,530 | 67 | % | |||||||||||
Selling, general and administrative expenses (“SG&A”) | 174,839 | 81,657 | 93,182 | 114 | % | |||||||||||
Depreciation and amortization | 29,430 | 28,410 | 1,020 | 4 | % | |||||||||||
Impairment of long-lived assets | 7,818 | — | 7,818 | NM | ||||||||||||
Restructuring charges | — | 19,927 | (19,927 | ) | NM | |||||||||||
Operating loss | (83,338 | ) | (58,679 | ) | (24,659 | ) | (42 | )% | ||||||||
Other income (expense): | ||||||||||||||||
Loss in equity method investments | (1,207 | ) | (1,696 | ) | 489 | 29 | % | |||||||||
Interest income (expense), net | (8,473 | ) | (4,501 | ) | (3,972 | ) | NM | |||||||||
Miscellaneous income (expense), net | (2,547 | ) | 34,017 | (36,564 | ) | NM | ||||||||||
Loss from operations before income taxes | (95,565 | ) | (30,859 | ) | (64,706 | ) | NM | |||||||||
Income tax benefit (expense) | 18,910 | (9,457 | ) | 28,367 | NM | |||||||||||
Net loss | (76,655 | ) | (40,316 | ) | (36,339 | ) | (90 | )% | ||||||||
Less: Net income (loss) attributable to redeemable noncontrolling interests | 2,212 | (3,889 | ) | 6,101 | NM | |||||||||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 365 | (630 | ) | 995 | NM | |||||||||||
Net loss attributable to Madison Square Garden Entertainment Corp.’s stockholders | $ | (79,232 | ) | $ | (35,797 | ) | $ | (43,435 | ) | (121 | )% | |||||
Three Months Ended | ||||||||||||
March 31, | Change (a) | |||||||||||
2020 | 2019 | Amount | Percentage | |||||||||
Revenues | 199,861 | 250,018 | (50,157 | ) | (20 | )% | ||||||
Direct operating expenses | 132,809 | 158,710 | (25,901 | ) | (16 | )% | ||||||
Selling, general and administrative expenses | 84,186 | 83,159 | 1,027 | 1 | % | |||||||
Depreciation and amortization | 26,196 | 26,768 | (572 | ) | (2 | )% | ||||||
Impairment of intangibles, long-lived assets and goodwill | 102,211 | — | 102,211 | NM | ||||||||
Operating loss | (145,541 | ) | (18,619 | ) | (126,922 | ) | NM | |||||
Other income (expense): | ||||||||||||
Loss in equity method investments | (1,096 | ) | (2,881 | ) | 1,785 | 62 | % | |||||
Interest income, net | 3,054 | 4,740 | (1,686 | ) | (36 | )% | ||||||
Miscellaneous income (expense), net | (17,381 | ) | 4,613 | (21,994 | ) | NM | ||||||
Loss from operations before income taxes | (160,964 | ) | (12,147 | ) | (148,817 | ) | NM | |||||
Income tax benefit (expense) | 10,126 | (469 | ) | 10,595 | NM | |||||||
Net loss | (150,838 | ) | (12,616 | ) | (138,222 | ) | NM | |||||
Less: Net loss attributable to redeemable noncontrolling interests | (22,447 | ) | (7 | ) | (22,440 | ) | NM | |||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 195 | (680 | ) | 875 | NM | |||||||
Net loss attributable to the Company | (128,586 | ) | (11,929 | ) | (116,657 | ) | NM |
Nine Months Ended | |||||||||||||||
March 31, | Change (a) | ||||||||||||||
2020 | 2019 | Amount | Percentage | ||||||||||||
Revenues | $ | 767,038 | $ | 832,384 | $ | (65,346 | ) | (8 | )% | ||||||
Direct operating expenses | 472,582 | 507,249 | (34,667 | ) | (7 | )% | |||||||||
Selling, general and administrative expenses | 257,970 | 231,038 | 26,932 | 12 | % | ||||||||||
Depreciation and amortization | 80,271 | 81,606 | (1,335 | ) | (2 | )% | |||||||||
Impairment of intangibles, long-lived assets and goodwill | 102,211 | — | 102,211 | NM | |||||||||||
Operating income (loss) | (145,996 | ) | 12,491 | (158,487 | ) | NM | |||||||||
Other income (expense): | |||||||||||||||
Earnings (loss) in equity method investments | (3,739 | ) | 17,131 | (20,870 | ) | NM | |||||||||
Interest income, net | 15,388 | 11,944 | 3,444 | 29 | % | ||||||||||
Miscellaneous expense, net | (2,893 | ) | (4,118 | ) | 1,225 | 30 | % | ||||||||
Income (loss) from operations before income taxes | (137,240 | ) | 37,448 | (174,688 | ) | NM | |||||||||
Income tax benefit (expense) | 8,686 | (1,253 | ) | 9,939 | NM | ||||||||||
Net income (loss) | (128,554 | ) | 36,195 | (164,749 | ) | NM | |||||||||
Less: Net loss attributable to redeemable noncontrolling interests | (23,851 | ) | (3,662 | ) | (20,189 | ) | NM | ||||||||
Less: Net income (loss) attributable to nonredeemable noncontrolling interests | 38 | (3,121 | ) | 3,159 | NM | ||||||||||
Net income (loss) attributable to the Company | $ | (104,741 | ) | $ | 42,978 | $ | (147,719 | ) | NM |
Changes attributable to | Operating income (loss) | |||
Entertainment | $ | (4,030 | ) | |
MSG Networks | (44,658 | ) | ||
Tao Group Hospitality | 21,337 | |||
Purchase accounting adjustments | 2,762 | |||
Inter-segment eliminations | (70 | ) | ||
MSG Entertainment Corp. total | $ | (24,659 | ) | |
(a) | See “Business Segment Results” for a more detailed discussion of the operating results of our segments. |
Three | Nine | |||||||
Months | Months | |||||||
Decrease in event-related revenues from concerts | $ | (17,694 | ) | $ | (22,600 | ) | ||
Decrease in suite license fee revenues | (9,464 | ) | (9,617 | ) | ||||
Decrease in venue-related signage and sponsorship revenues | (6,296 | ) | (11,049 | ) | ||||
Decrease in event-related revenues from other live sporting events | (5,204 | ) | (8,704 | ) | ||||
(Decrease) increase in revenues associated with entertainment dining and nightlife offerings (a) | (5,037 | ) | 1,503 | |||||
Decrease in event-related revenues from other live entertainment events | (3,889 | ) | (2,068 | ) | ||||
Decrease in revenues from Obscura due to the decision to wind down its third-party production business to focus on the development of MSG Sphere | (1,049 | ) | (9,178 | ) | ||||
Decrease in ad sales commission due to lower sales in advertising availabilities of MSG Networks | (793 | ) | (552 | ) | ||||
Decrease in revenues associated with the expiration of the Wang Theatre booking agreement in February 2019 | (632 | ) | (3,883 | ) | ||||
Increase in revenues from the presentation of the Christmas Spectacular | 275 | 2,044 | ||||||
Other net decreases | (374 | ) | (1,242 | ) | ||||
$ | (50,157 | ) | $ | (65,346 | ) |
Three | Nine | ||||||
Months | Months | ||||||
Decrease in event-related direct operating expenses associated with concerts primarily due to the impact of the temporary closure of venues since March 12, 2020 due to COVID-19 | $ | (6,883 | ) | $ | (6,958 | ) | |
Decrease in direct operating expenses associated with suite licenses primarily due to lower revenue sharing expenses associated with suite license fee revenue decreases | (6,112 | ) | (6,793 | ) | |||
Decrease in direct operating expenses associated with the venue-related signage and sponsorship primarily due to lower revenue sharing expenses associated with venue-related signage and sponsorship revenue decreases | (6,014 | ) | (9,686 | ) | |||
Decrease in direct operating expenses associated with entertainment dining and nightlife offerings | (2,880 | ) | (427 | ) | |||
Decrease in event-related expenses associated with live sporting events | (1,863 | ) | (3,529 | ) | |||
Decrease in direct operating expenses associated with Obscura due to the decision to wind down its third-party production business to focus on the development of MSG Sphere | (1,822 | ) | (8,314 | ) | |||
Decrease in event-related direct operating expenses associated with other live entertainment events | (1,115 | ) | (2,384 | ) | |||
Decrease in direct operating expenses associated with the expiration of the Wang Theatre booking agreement in February 2019 | (927 | ) | (2,621 | ) | |||
(Decrease) increase in direct operating expenses associated with the presentation of the Christmas Spectacular | (85 | ) | 231 | ||||
Increase in venue operating costs, net of recovery charges from Madison Square Garden Sports Corp. | 3,578 | 6,809 | |||||
Other net decreases | (1,778 | ) | (995 | ) | |||
$ | (25,901 | ) | $ | (34,667 | ) |
Three Months Ended | ||||||||||||||
March 31, | Change | |||||||||||||
2020 | 2019 | Amount | Percentage | |||||||||||
Operating loss | $ | (145,541 | ) | $ | (18,619 | ) | $ | (126,922 | ) | NM | ||||
Share-based compensation | 8,836 | 8,726 | ||||||||||||
Depreciation and amortization (a) | 26,196 | 26,768 | ||||||||||||
Impairment of intangibles, long-lived assets and goodwill (b) | 102,211 | — | ||||||||||||
Other purchase accounting adjustments | 1,068 | 1,069 | ||||||||||||
Adjusted operating income (loss) | $ | (7,230 | ) | $ | 17,944 | $ | (25,174 | ) | NM |
Three Months Ended September 30, | Change | |||||||||||||||
2021 | 2020 | Amount | Percentage | |||||||||||||
Operating loss | $ | (83,338 | ) | $ | (58,679 | ) | $ | (24,659 | ) | (42 | )% | |||||
Non-cash portion of arena license fees from MSG Sports | (543 | ) | — | |||||||||||||
Share-based compensation | 19,528 | 16,156 | ||||||||||||||
Depreciation and amortization (a) | 29,430 | 28,410 | ||||||||||||||
Amortization for capitalized cloud computing arrangement costs | 85 | — | ||||||||||||||
Merger and acquisition related costs | 37,192 | — | ||||||||||||||
Impairment of long-lived assets (b) | 7,818 | — | ||||||||||||||
Restructuring charges | — | 19,927 | ||||||||||||||
Other purchase accounting adjustments | 85 | 924 | ||||||||||||||
Adjusted operating income | $ | 10,257 | $ | 6,738 | $ | 3,519 | 52 | % | ||||||||
Nine Months Ended | |||||||||||||||
March 31, | Change | ||||||||||||||
2020 | 2019 | Amount | Percentage | ||||||||||||
Operating income (loss) | $ | (145,996 | ) | $ | 12,491 | $ | (158,487 | ) | NM | ||||||
Share-based compensation | 29,294 | 27,929 | |||||||||||||
Depreciation and amortization (a) | 80,271 | 81,606 | |||||||||||||
Impairment of intangibles, long-lived assets and goodwill (b) | 102,211 | — | |||||||||||||
Other purchase accounting adjustments | 4,464 | 3,717 | |||||||||||||
Adjusted operating income | $ | 70,244 | $ | 125,743 | $ | (55,499 | ) | (44 | )% |
(a) | Depreciation and amortization includes purchase accounting adjustments of |
(b) | For the three non-cash impairment charge of right-of-use |
Three Months Ended September 30, 2021 | ||||
Increase in adjusted operating loss of the Entertainment segment (a) | $ | (13,115 | ) | |
Decrease in adjusted operating income of the MSG Networks segments (a) | (18,598 | ) | ||
Increase in adjusted operating income of the Tao Group Hospitality segment (a) | 35,302 | |||
Inter-segment eliminations | (70 | ) | ||
$ | 3,519 | |||
(a) | See “ — Business Segment Results” for a more detailed discussion of the operating results of our segments. |
Three Months Ended | ||||||||||||||||
September 30, | Change | |||||||||||||||
2021 | 2020 | Amount | Percentage | |||||||||||||
Revenues | $ | 34,239 | $ | 7,555 | $ | 26,684 | NM | |||||||||
Direct operating expenses | 36,302 | 23,615 | 12,687 | 54 | % | |||||||||||
Selling, general and administrative expenses | 92,962 | 52,650 | 40,312 | 77 | % | |||||||||||
Depreciation and amortization | 19,656 | 22,014 | (2,358 | ) | (11 | )% | ||||||||||
Restructuring charges | — | 19,927 | (19,927 | ) | NM | |||||||||||
Operating loss | $ | (114,681 | ) | $ | (110,651 | ) | $ | (4,030 | ) | (4 | )% | |||||
Reconciliation to adjusted operating loss: | ||||||||||||||||
Non-cash portion of arena license fees from MSG Sports | (543 | ) | — | |||||||||||||
Share-based compensation | 10,143 | 10,433 | ||||||||||||||
Depreciation and amortization | 19,656 | 22,014 | ||||||||||||||
Amortization for capitalized cloud computing arrangement costs | 41 | — | ||||||||||||||
Merger and acquisition related costs | 13,992 | — | ||||||||||||||
Restructuring charges | — | 19,927 | ||||||||||||||
Adjusted operating loss | $ | (71,392 | ) | $ | (58,277 | ) | $ | (13,115 | ) | (23 | )% | |||||
Increase in event-related revenues, as discussed below | $ | 20,660 | ||
Increase in venue-related signage and sponsorship revenues due to the return of events at the Company’s venues during the current year period as compared to no events held in the prior year period due to the COVID-19 pandemic | 2,663 | |||
Increase in revenues from signage, suites licenses, and sales of food, beverage and merchandise subject to revenue or profit sharing with MSG Sports pursuant to the Arena License Agreements | 1,726 | |||
Increase in arena license fees from MSG Sports pursuant to the Arena License Agreements, as discussed below | 1,328 | |||
Decrease in inter-segment revenues on advertising sales commission from MSG Networks, which is eliminated on consolidated basis | (785 | ) | ||
Other net increases | 1,092 | |||
$ | 26,684 | |||
Increase in event-related direct operating expenses, as discussed below | $ | 9,726 | ||
Increase in direct operating expenses associated with venue operating costs | 2,726 | |||
Increase in direct operating expenses associated with revenue sharing expense from signage, suites licenses and sales of food, beverage and merchandise with MSG Sports pursuant to the Arena License Agreements | 1,281 | |||
Other net decreases | (1,046 | ) | ||
$ | 12,687 | |||
Three Months Ended September 30, | Change | |||||||||||||||
2021 | 2020 | Amount | Percentage | |||||||||||||
Revenues | $ | 141,473 | $ | 157,363 | $ | (15,890 | ) | (10 | )% | |||||||
Direct operating expenses | 68,423 | 65,072 | 3,351 | 5 | % | |||||||||||
Selling, general and administrative expenses | 47,975 | 22,527 | 25,448 | 113 | % | |||||||||||
Depreciation and amortization | 1,797 | 1,828 | (31 | ) | (2 | )% | ||||||||||
Operating income | $ | 23,278 | $ | 67,936 | $ | (44,658 | ) | (66 | )% | |||||||
Reconciliation to adjusted operating income: | ||||||||||||||||
Share-based compensation | 7,474 | 4,627 | ||||||||||||||
Depreciation and amortization | 1,797 | 1,828 | ||||||||||||||
Amortization for capitalized cloud computing arrangement costs | 44 | — | ||||||||||||||
Merger and acquisition related costs | 23,200 | — | ||||||||||||||
Adjusted operating income | $ | 55,793 | $ | 74,391 | $ | (18,598 | ) | (25 | )% | |||||||
Decrease in affiliation fee revenue | $ | (12,265 | ) | |
Decrease in advertising revenue | (3,562 | ) | ||
Other net decreases | (63 | ) | ||
$ | (15,890 | ) | ||
Three Months Ended September 30, | Change | |||||||||||||||
2021 | 2020 | Amount | Percentage | |||||||||||||
Revenues | $ | 119,464 | $ | 7,221 | $ | 112,243 | NM | |||||||||
Direct operating expenses | 61,093 | 9,828 | 51,265 | NM | ||||||||||||
Selling, general and administrative expenses | 34,094 | 7,603 | 26,491 | NM | ||||||||||||
Depreciation and amortization | 6,378 | 1,046 | 5,332 | NM | ||||||||||||
Impairment of long-lived assets | 7,818 | — | 7,818 | NM | ||||||||||||
Operating income (loss) | $ | 10,081 | $ | (11,256 | ) | $ | 21,337 | NM | ||||||||
Reconciliation to adjusted operating income (loss): | ||||||||||||||||
Share-based compensation | 1,911 | 1,096 | ||||||||||||||
Depreciation and amortization | 6,378 | 1,046 | ||||||||||||||
Impairment of long-lived assets | 7,818 | — | ||||||||||||||
Adjusted operating income (loss) | $ | 26,188 | $ | (9,114 | ) | $ | 35,302 | NM | ||||||||
Increase in revenues due to Hakkasan, acquired in April 2021 | $ | 59,352 | ||
Increase in revenues at venues subject to capacity restrictions in the prior year period | 26,273 | |||
Increase in revenues at venues that were temporarily closed in the prior year period as a result of the COVID-19 pandemic | 25,548 | |||
Other net increases | 1,070 | |||
$ | 112,243 | |||
Increase in direct operating expenses due to Hakkasan, acquired in April 2021 | $ | 27,866 | ||
Increase in the costs of food, beverage and venue entertainment as a result of resuming operations compared with the prior year period’s closure of certain venues and capacity restrictions due to the COVID-19 pandemic | 10,165 | |||
Increase in employee compensation and related benefits as a result of resuming operations compared with the prior year period’s reduction in headcount resulting from the COVID-19 pandemic | 10,110 | |||
Increase in rent expense, primarily due to rent concessions in the prior year period resulting from the COVID-19 pandemic | 2,679 | |||
Other net increases | 445 | |||
$ | 51,265 | |||
Three Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Net loss | $ | (76,655 | ) | $ | (40,316 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities | 42,939 | 3,819 | ||||||
Subtotal | $ | (33,716 | ) | $ | (36,497 | ) | ||
Changes in working capital assets and liabilities | 40,704 | (58,730 | ) | |||||
Net cash provided by (used in) operating activities | $ | 6,988 | $ | (95,227 | ) | |||
Net cash provided by (used in) investing activities | (146,302 | ) | 192,234 | |||||
Net cash used in financing activities | (44,797 | ) | (15,996 | ) | ||||
Effect of exchange rates on cash, cash equivalents and restricted cash | (386 | ) | 5,814 | |||||
Net increase (decrease) in cash, cash equivalents and restricted cash | $ | (184,497 | ) | $ | 86,825 | |||
Nine Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Net income (loss) | $ | (128,554 | ) | $ | 36,195 | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 218,068 | 102,134 | ||||||
Subtotal | $ | 89,514 | $ | 138,329 | ||||
Changes in working capital assets and liabilities | 47,437 | (93,363 | ) | |||||
Net cash provided by operating activities | $ | 136,951 | $ | 44,966 | ||||
Net cash used in investing activities | (477,984 | ) | (156,851 | ) | ||||
Net cash provided by financing activities | 266,900 | 32,578 | ||||||
Effect of exchange rates on cash, cash equivalents and restricted cash | 3,916 | 6,440 | ||||||
Net decrease in cash, cash equivalents and restricted cash | $ | (70,217 | ) | $ | (72,867 | ) |
Entertainment | $ | 74,309 | ||
MSG Networks | 424,508 | |||
Tao Group Hospitality | 1,364 | |||
$ | 500,181 | |||
Entertainment | $ | 74,111 | |
Tao Group Hospitality | 7,885 | ||
$ | 81,996 |
Trademarks | $ | 61,881 | ||
Photographic related rights | 1,920 | |||
$ | 63,801 | |||
Trademarks | $ | 61,881 | |
Photographic related rights | 3,000 | ||
$ | 64,881 |
(a) | Index to Exhibits |
10-Q/A for the quarter ended September 30, 2021, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) consolidated balance sheets, (ii) consolidated statements of operations, (iii) consolidated Statements of comprehensive loss, (iv) consolidated statements of cash flows, (v) consolidated statements of equity and redeemable noncontrolling interests, and (vi) notes to consolidated financial statements. | |||
104 | The cover page from the Company’s Quarterly Report on Form 10-Q/A for the quarter ended |
† | This exhibit is a management contract or a compensatory plan or arrangement. |
+ | Certain confidential information - identified by bracketed asterisks “[*****]” - has been omitted from this exhibit pursuant to Item 601(b)(10) of Regulation S-K because it is both (i) not material and (ii) would be competitively harmful to the Registrant if publicly disclosed. |
Madison Square Garden Entertainment Corp. | ||||
By: | / | |||
Name: | David F. Byrnes | |||
Title: | Executive Vice President and Chief Financial Officer |