FWONA - Earnings call 4 2020 | Formula One Group

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Liberty Media Corporation 2020 Year-End Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded today, February 26. I would now like to turn the conference over to Courtnee Chun, Chief Portfolio Officer. Please go ahead.

Courtnee Ulrich

you. Thank morning. Good

of speak due to or XX-K we'd including includes Liberty begin, the Form or the events, Corporation's change remind those and in that Actual disseminate herein any Media and everyone which Securities Before due forward-looking like any of or with disclaim statements Media Liberty date Acquisition's statements conditions Liberty only call materially to events XXXX. and of or of certain contained registration in to risks Reform reflect Liberty Liberty most circumstances to the any statement such forward-looking in Media filed Media's this any uncertainties Media any of based. could or within statement number on undertaking a this expressly is recent revisions or change regard Liberty differ their statements any call Litigation we Act updates mentioned to or results Form the S-X Acquisition Media Private Acquisition SEC. These expectations with forward-looking obligation meaning

the press OIBDA today's issued definitions adjusted and On will non-GAAP adjusted certain measures Media's EBITDA. release is Liberty be found SiriusXM Liberty can on we X website. of Media Liberty including earnings SiriusXM, today, The end discuss for required Media for the and and X reconciliations financial and call, and Schedules available the at which

Maffei, President I'd like the Now and CEO. to turn over Liberty's to call Greg

Gregory Maffei

and Officer Wendling. Financial Liberty's have Formula Brian on Principal all CEO; you. President speaking also call, good Officer, the we to morning you, new and and will Chief Stefano Domenicali; and of Courtnee, Thank Accounting One's, Today

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Brian Wendling

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Stefano Domenicali

One. Thank of warm you, Liberty. The the all lead our you first all Formula teams honored for Thank Brian. and the to thrilled and to I'm welcome. FIA, of partners

past Before I and organization start, decades I the in foundation strong building X his that us the for an ahead. work Chase years gives for over very tireless the growth thank the want to

the Last business everyone and globe, felt sport around year pandemic. the the a every for challenge the was of of impact

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objectives cost power unit and, of generation next the reduction new sustainable manufacturers. truly significant for unit to to power are course, power the fuels, XXXX, neutrality, the attractiveness hybrid look units, we carbon As of the key

topic, for a have attractive this OEMs and We diversity potential One official conversations hybrid to about fuel of sustainable confirm our and automotive in with another pillars One platform community. and Race very believe on We the had is existing world. platform and portfolios already core very feel this we with Formula moving OEMs and the that in. Continuing engine the X will be productive inclusion, As the the this of sustainability, decarbonization and ESG about very positive become direction the area drive will I the provides across product their solution offer

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in to and can't the to X drama to Formula you. March continues our One and forward looking March us, captured enough are X We again and Bahrain Prix on and to watch thank to opening once Thank lines to on Netflix of Grand have there's update bring question in of look so no you, will new front excitement be all of please to express season hitting The I XXXX, series sure my sport. once turn that forward XX. the Greg. on Drive But again, XX. And you Survive, story Season all much, fans for progress. I it with that, over you opportunity the

Gregory Maffei

Brian. And floor Liberty you're interest in and safe I'd Thanks, Thanks, all Stefano, We operator, listening questions. the audience. like your that, to continued Media. appreciate And our staying hope open to to healthy. and with

Operator

first Instructions] Evercore. today [Operator Vijay of Our Jayant from comes question

Vijay Jayant

X. have I

level? Is to are on requirement that the sharing there company mentioned we Greg, expectation with I that shift you -- a towards works in of perfectly at post there an decide on sort capital your sort private? equity should allocation a Anything like in XX%? be out will buybacks? of obviously, sort more that will capital what you tax obstacles the structure happens sort dividends path? the share capital path will are on kicks the sort of how And be of the to any squeeze small. or there pretty Or tax XX%. think Is a taking XX% that will with can of rate First, Sirius, we flow Obviously, the that But assume post both moment. that. agreement at And Board dividends given that

mentioned of your been just the you've over talking sort you of race, but I in do press to suggesting to format terms Can and get really make Stefano. a for free about sprint of need ] looking practices for races, race the second, change obviously, talk more the event to need quality you're perspective, it that you're in what wanted quantity think biggest and really practical. broadly? is weekend [ bigger the opportunity can where you you -- you the think the about you where you making And just

Brian Wendling

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

decision a of really it all, of is the board. full First

correctly note Liberty dividends, slight compared really at that Liberty where that But margin, would we tilt it's You once not Media, Siri a to on have would we probably towards the bigger we tilt. were.

While we're the XX% low NAV just in up. under when more the And XXs. discount at to about substantially running the blew to GME looking from tightened running world we were XX%, the mid- like

tightened So it. we have

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ensuring we by And the independent minority that think the about be made So of some to voice protected. pace the directors some at get might a at number. appropriately full But would Board. is really again, will about kind will have directors point, decisions those the that which

Gregory Maffei

to to That's are with thinking on goal what in we Okay. term show. regard format answer to the my to of question improve the

that that to that to of to to let say to the are all, try are exciting. watching objective television, are of people Formula coming people me something that event, the fans One, our is is First really to the people the offer that

the a on we Saturday determine shared, out received So a the sprint think figure have race. the Friday, we to as qualifying that idea will race grid that, and we that give something great from in try that feedback I everyone Sunday order we sport have that for is the will

this will detailing be is a So in of in to the aim the the of the all parting weekend next order with that the the beneficial the present that are will the great give weeks this of to But in and in the we that final rain. season teams start to boats. year something do what thrill FIA that respect. try the we that's format before And

Operator

of Our comes Karnovsky from David next question JPMorgan.

David Karnovsky

bit discuss the Can just of think on might engine development you of view toward GM all-electric freeze of light moving long-term goals in some this engine OEMs maybe then and Jaguar on the track impact how a And like you vehicles? competition? on and FX's your expand

Gregory Maffei

David, the Well, thank for question. you,

is I think Formula X-year important that freezing the business One new say approach that sustainable taken. to what is to of connected idea advance in has this that

cap We managing of have that with related team. a taken is to this the of certain year cost part the cost the

The of very how as in was, was margin, not other we can cost investment and unit. the control capture but power part important the business normal a

Therefore, can we end but anticipate would are future. today potentially of spending we engine, how in by that also new involved the the thinking we of were associated that making attention are manufacture, ones sure for new the the interested fact capture the a money

different have their in So allow hybrids the the electrification to believe would manufacturers that to only we position portfolio, access by to normal a do not future is an exact the all being business.

course, the all package the have what in position to aligned from terms having future. neutrality, to we're hybrid And management lot sort in So sustainable value cost the being us the and of doing and a of sustainable and be advanced our fully that and road automotive different that extra under Formula in being of of going this power I a gave relevancy, fuels at putting win-win way also a center having by activity being that everyone activity control place for can attention unit situation. A only being being in with of have One are benefit that, we therefore, of that can factory. in terms the control, respect in technology of beneficial electric of really making always carbon at think great pinnacle sure to a research

that So these decided path. we're are when base follow to we taking this the thinking go and

David Karnovsky

believe a And year. there race the of end number contracts is expiring then I of promotion at Okay. this

I and Singapore the think U.S.

FX think South are these Just future? at I maybe recently, you then race mentioned markets, any about thinking see regards there some flyway versus on you to to we wondering update then the is Africa whether new and in how the point adding and can races with regions you provide that might other non-duty

Stefano Domenicali

I is we because one mean yes, only decide, by Well, in for the terms Community. races the the in despite requests not the also incredible of that all from sure that, we're of center world the the in what moment from our number organizer -- the great shows an of achieving pandemic are plan the yes, interest year. the Motorsport is of but strategic right Therefore first around to dimension of

in us. there considering also the in have contract you that important future. and of we lot that aim for the there in them are keep strategic expiring U.S. to are race to The because and as know is very U.S. progress and add the you're another market are you really discussions mentioning We ongoing important but And confirm, ones is -- interest are

us. very would but We for great are we that important other have Austin, in already be for partner looking solutions

future. sorry, -- the area for strategic exploit our in with of say, you for sure in very have business for general race can I that opportunities the What see whatever that growth And is for the we're that we an the important reason out error to where going didn't but happened, sure an that's Vietnam is future. for

Gregory Maffei

this we if could in pretty which promoter unusual any of not an year. And much expiring year to I number I comments with, just or agree have Stefano's add contracts do

there's have year, just in a than have for our that, sport, renewed behind. get demand a think We of ahead because that we we number are certain renewed opportunity broadcast think we general every and contracts year, will rise all where portfolio every Because appreciate feel number actually that. certain more we like we

Operator

next Ben Stanley. comes Our from question Morgan of Swinburne

Benjamin Swinburne

rights. to both want question I and sports Greg, just ask Stefano a around

the sort And Maybe of market in state now. and the U.S. Europe right

usual a last gone You EPL, or on happening, renewal seen Bundesliga deals other the going Serie at FOX may year. And clearly rollback. Sky But the very tricky in what's backwards, -- been lease reports is code space Greg, A on obviously XX:XX than press happened more that the we've Germany has with and and there guys with had even with Sinclair successful in suggests have some Sports in some probably tension there least have press U.S. the of cutting.

maybe just feeling how through And of 'XX and a gotten challenging than give more if move more it sort think as market's sense complicated of you So your guys you you 'XX, the can us Braves? you're even and and both about was position with FX the a couple years ago?

Gregory Maffei

cut a do to? or want take happy to you Stefano, I'm

Stefano Domenicali

explore and living for to the to, see future. we're very, models for night other. said, our hugely model, we one can connection still eye, very in mean, from direct sure, the on I very world I different what for the be see mean, extend I opinion, area broadcaster good are an know, is, as complementary platforms to on my fund But give business the to very us. that, opportunity provide interesting OTT and sport in you by side, that important today that the situation a can Okay. an is for sure, as a we partners good will, the important but we

future that it's to able make you believe sure to the need sport give are as deliverable I because are the we honest, doing are that to we attract sure the and for commercial the be make that to if But we the fans. up the shaping account, sport, do to interest the there, context is

of don't that's connected we make why the young religious fans, we to language activity sure first need lose we have very fans, course, a but new of new And supporters, the to speak all, to and generation. of the traditional the lot the that, of

this lot make have a sure already programs happening to of that we year. is So this

be to honest. that, So I'm on positive

Gregory Maffei

could, I Stefano's had couple more, with I a agree but comments, if I Ben.

a Chase. last on thank fan we've -- a That's ancillary try now a that competition. done more lot Survive, fan Drive those of you, track all like and And things building few interest. lot over like 'XX that's to Stefano, the we into fan that's fan are excitement. you, years. Thank interest as balanced and field we programming, -- to that First, go festivals, And like build of

among the is interest, is deal, important And we component were Obviously, when distributors the renewal. there product. an That's potential fan deal how interested there for in was important component and bidders, much because largely have component Probably our is competition your go highly obviously U.K. Esports bidders how much product. well. How most it our of as much you probably several is? there getting best excitement candidly,

feel, as we do relative a Stefano I have value. notes,

per in declines seen relative et alternatives. the higher look of kind of basis if value. per a But You've on about some like cost at cost any eyeball, other you what European FX cost looks hour, cetera,

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

players competition, will do excited. sniffed, if the benefit be some get them about from entering, believe, we can prospects above FX's our they will digital excited I'm all, new I potentially increased to become and is see that we and but bidders, and which So of they we'll benefit. would ultimately, have

overbuy, lot U.S. obviously, bundle with bundle around including amount will there be caused breaks, that program, at XX, -- if teams whether had back from Braves, sport of the has of it the the feel good about world kinds rights paid including the our a RSNs I and total contracts sports first. looking for Braves. relatively Braves, all as we've a of risk far As is to a and what the be

contract, household a far not Dodgers. in have the like well we the somebody largest broadband away, But secondly, highest, And the we audience. but contrast, below good have and

million households. XX broadband have Braves the the with So territory largest

arise benefit alternatives probably weekends. the compared bundle of best shape at degree as look like, in you too new Sort to potentially many the and the we digital are in alternatives

Benjamin Swinburne

season. luck this Good East in NL the

Operator

Our question Bryan Deutsche Kraft Bank. comes of from next

Bryan Kraft

of couple A questions.

you for call path businesses over Greg, I'll can live expectations out to and 'XX about 'XX? your current for what your normalcy event you First, can looking the -- talk

There's of obviously be able on to and 'XX looks a by normal lot back of focus normal. half bounce in investors or quickly 'XX to looks whether these businesses back the going like market are how

looks thoughts Formula them? One, Nation, like So get would for that Braves, what the what just to on path love your Live

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

Gregory Maffei

then and between. We're fan has will in see 'XX. right, of FX in but will less and I'll to XXXX of binary. some somewhere where in it impeded, the sources It's So advertising, broadcast, again, was pillars probably in promotion than opening. binary going on degree not lot the be to revenue. XXX, of got be will not I have big fans, potentially be the will because we think, again, FX have And component, a to regardless but necessarily multiple X pandemic. 'XX start it don't a not alternatives fans ways to there. which of variety certainly we're it's And be the in going probably component, Braves, impeded the certainly less Sponsorship was less X instead impeded and which and binary,

to more as capacity. to end XXX% we're to optimistic the go get I'm going we year, of the of So

thing both site, same as don't we -- on and component have One. multiple television a the Formula we large the Braves, is really with revenue streams, in but as sponsorship. it And It's not have a do

expectation already is think, Georgia XX%. probably not again, mentioned relatively I open. we'll out binary. at start that The I is

decided attendance fan be were some shape far you rules the will baseball, the New York terms or of if other than local but and by California in not locales. or will it And in We authorities. by be better in

obviously, So the XXX a binary. in of Nation XX think Live have from going But the we're not doesn't will to is as, numbers I expectation have And flip to switch. space again, go a of there. increasing don't we vulnerable by the obviously, advertising to depending and or where the so most Offset or is potential sponsor in element, different doesn't very with really affected shutdowns. responsive world. have the that responses global the broadcast it's for business, you are

they fully of work yesterday. it think, They expectations, definitely Certainly, grow. I there I of -- at do slightly that for be and that. The still you've particular invincible, think year. some will will is ahead already just efforts, balance announced and that, have events supportive be preparing seen is sheet done meaningful I fans So throughout earnings in think whatever this Formula One 'XX. But we're a comes, of to will

if of that that So we probably make business pace And doesn't crystal prepare like. we that non trying of open. of benefit businesses we are we balance turns a of prepared. And somewhat are those -- in happen to does sort the certainly well the I of or rates answer, ball exactly, think sheet of in change that's but And Bryan, kind prepared because sure would the pick that to we're when are that's at it all the business question. or X

things very, one of balance is to think -- and of Liberty sheet operating have our is look the hopefully One Formula be can strong. The benefit I we the part ability Group of being the ahead you with the about very companies. thoughtful

they're agreements FX strong. at I at obviously, it's quite level, are operating our look growth when the strong the have, And you we think FX levels then And operating cash fine. I that the -- level. and

balance worried So about really the I'm sheet. not

Brian Wendling

And just leverage on quick question to your answer the target. real

is Formula recall, only had it Xx March equity have leverage, as stated, through max we a that been As target approaching has X.XX Xx to through the you waved issuance One cash we've that bought generated, we primary did have X.Xx. business, and And a And operations leverage will but not we delevered substantially of we leverage XX, when XXXX. as well.

reduced even leverage So the both of pandemic. the prior to those

Operator

Beckel Berenberg Our next Capital. David from comes of question

David Beckel

promotion many reopening. part, revenue different your in scenarios, a the Sort is of could the parts if side, the of seems vaccine piggybacking going wondering as of really for think rollout, about variety it about the all on I streams was recognition revenue us under help you world. most better-than-expected for commentary the if

about revenue given thinking protected race somewhat be Or we you is last being promotion made that concessions the Should year? materially affected in HX?

upside thoughts current And how structure then share this FX to a in payment your maybe year? your the of I'd hear team we affect Specifically, willing marginal EBITDA levels that of extent exceeds might year? or EBITDA on that, could the level, earnings EBITDA to to XXXX to if should sort frame expect you love in as the you're preteen to reference if follow-up XXXX,

Gregory Maffei

So what in I'll 'XX -- certainly still a non-pandemic be would promotion year. I in will reduced think versus have we

restricted have of events. audiences restricted will fans We some our and at

So you I we're make still let to because this is also forecast we some in around, a do floating and where do. in because of but not part the that's expect, to here up like air,

impacted profitability. structure And -- the it as will going amount we a with be will Concorde much definitely -- have which new we'll be which, increased see. how the we we So Agreement, have forward, to

earned in The for years. take a of we we'll as that We of going forward, given the share slightly have rates you what do believe 'XX, anything. us. increase. Stefano, over FX would add get historically margin little continue Whether risks attractive confident. years opportunity the hit pandemic. the the back some to healthy I'm more the have comparably fully a business, as I in will our But not to around

Stefano Domenicali

the approach important to And new with that couldn't that so measure, I us given the Concorde more. government, the I it's allow think bigger. cost control new that Agreement, agree the what with think is do point with this new the drives sustainability that that of perspective championship. also be the is of view from to believe the that the fundamentals this is from and really right both And I incredible way, commercial right feed part something

Operator

David question next from today Barclays. Joyce The of comes

David Joyce

One, this escalators, for Would Formula about grossing of as on the think step-ups, of up A side it to couple COVID-related of One sort any we there of be lingering questions. and year. should and impacts? comparable number the business XXXX Or broadcast events? being for

then And Braves. on secondly, the

touched With the bit Sinclair was this on call. RSN in the a little agreement, already earlier and

Where horizon having could your that moving further does into with that do economics? Georgia? do engagement How over-the-top even model? tie something play that in you what that sports betting towards a fan hybrid for the stand could into becomes And once on them as

Gregory Maffei

was in broadcast Again, take fairly make now. concessions XX some 'XX how in a revenue degree expect ball the out. crystal that to races But COVID or had broadcasters. our goal pain try rightly we So to and about our to plays the our of exactly stream we normal to lightest

'XX possible to to Our and goal as a as make much normal. event was bring that 'XX back

So hope our that is our and expectation.

that as But COVID on thinking the about -- the warning. change could a And RSNs.

things been things. major trying of contract. full what contract As would that has we game have me I some about 'XX. want I of I not a in said, to a rights or we do normal baseball But do. some is different can pace, can to Sinclair alternatives. from have expect have do know to do certainly Sinclair would It's normal discussions with not runs the our know we XXX some 'XX the there clear to I new exactly they do to Sinclair assuming in through the they a schedule -- change, on I streams run and revenue rest think expect

terrific And I what some rights do not engagement to are those their help Again, Sinclair things, job. Sinclair new thinks model additive. that's -- sure see. their I'm us whether of would be We'll but that to a could exactly

David Joyce

Or Formula how that's think a baked algorithm components. the on promotion how COVID contracts we and One, should the contracts? those finally, there on between and strokes, in in general should impact Is just that? the mix variable we about about think broad And into fixed sponsorship

Gregory Maffei

meet. Well, them triggers or not have be do I probably they any trigger think we of will able that -- do most likely to have, look,

not for whether you or good a On partner the And airline be them partner long-term. a down the goal. gets a take that's going all other hand, who for decide large who's can been doing our shut with foreign international you're to basically travel,

us with the work we'll during way have appreciate difficult that that the time. they So them we with in worked

Operator

Jason Our of from comes Bazinet next Citi. question

Jason Bazinet

there's is it color you of having in amendments passive you Was some that terms an any But thing. is there big general might looking these have? more that unencumbered guess was did you do, if something that wondering specific need or some Or always I the extra optionality? a stakes. liquidity to you equity add just I of that were

Gregory Maffei

Ben our let Well, answer. know optionality, we're new I'll relatively Jason, but to Oren, you into treasury

Ben Oren

loan, same billion. shares With collateralizing as we loan upsize, that margin $X.XX did we billion kept an Sure. respect it previously had the we under the the X but to to do SIRI

where LTV to something So With that loan. were of just that's a respect appropriately the function repaid maximizing had our of took a the substantial ability the dollars. rightsized access to to and margin shares underlying margin happened we previous number when and loan, we're for really we we shares collateral what closer amount it, a Live, it's so a that in underlying that realistic loans pool $XXX to million, of to we

Operator

of question Gabelli. Tinker comes from John next The

John Tinker

your loss, which think, be ever a different the on would little most any property same. you way? consider valuation, have -- unfortunately, Do I Terrific focused people get in Battery given and the in that it you numbers in way any Brave, any the would highlighting

Gregory Maffei

when relatively work, the value impressive, no, need with to up being we've -- great right, on. place noted. Battery, come value deal the there we analysts don't I a function have a both us, it's you is you're the writing in is Georgia as we That's like of John, for open and it think

create appropriately well. sure there a come secure doing job people to team X developments. and to is a are think make Battery willing we're our the And great really that, tracker done do highlight a where in I different We value going not open that estate to and has something and create -- around and try real environment, but we sure management Braves I'm the it's we'll that or

Operator

comes question of final And Benchmark. from today Harrigan the Matthew

Matthew Harrigan

Intel, Qualcomm. Formula we're data other generates with under probably that One any with though seeing and concert AWS, the sports It than more and Even underdeveloped Ansan in Bernie. really was

now. Universal at Grand a had lot Prix You of success

I the how maybe and of lot think on you see having But headroom look you you like can there, some about the cameras terms a side? to races made TV of angles eventually. could you've and video developing? and more game feels but there's of still and potential all It in lot that what do you side that laude, the strides, a got the talk on

Gregory Maffei

point, Matt. Yes. No, a I great that's think

angles the linear think a about you plays have on really If have, the what different where we dial have, than want. an -- number world straighted your of and up players side, That evolving we strength angle increased perfectly to of we players. where digital ability digital the you feed. those the of to The of kind sort have cameras we broadcast starting potential -- for increased

are in will that think viewing. and experience that will a on that can terms we see that you Different side be one attention think tailor, I can I the fan digital benefit ahead. of It the So great. sport from opportunity increased

opportunities and advantage valuable well the our very ISE. with other and that in out there because it around not forward amount that that, of gambling, most I did data is look as place do as -- strong sports we amount proprietary which of a information we are believe of take fan and of is to to lot quite contract the The the is relative proprietary. data, around a That that we began that point at around But go have turn begun is data, we all as we like.

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

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

Operator

call. conference We Ladies thank your and gentlemen, that participation. concludes today's for you

disconnect. may now You

Formula One (FWONA) 26 Feb 212020 Q4 Earnings call transcript