Shareholders Entertained By MSG Earnings

MSG shareholders are celebrating after it reported better-than-expected results. But first, let’s all get on the same page about how MSG is structured. ⏸️

Madison Square Garden Sports Group ($MSGS) is the leading professional sports company that owns the New York Knicks and New York Rangers. It also owns two development league teams and operates a professional sports team performance center. Meanwhile, Madison Square Garden Entertainment Corp ($MSGE) is a leader in live entertainment. It owns world-renowned venues like New York’s Madison Square Garden and Radio City Music Hall, among others.

Both entities were part of Madison Square Garden, Inc. ($MSG) before it completed restructuring in mid-April. As a result of the spin-off, this $MSG symbol is no longer active in the public markets. πŸͺ¦

For this story, we’re referring to the venue-owning part of the brand ($MSGE). Let’s dive in. πŸ‘‡

The company’s GAAP earnings per share (EPS) of $0.42 doubled the $0.21 estimate. Meanwhile, revenues rose 3.7% YoY to $201.23 million, beating the consensus view by roughly $9 million.

Some other key stats included:

  • Arena license revenue with NY Knicks & NY Rangers +$11.7 million YoY.
  • Food, beverage, and merchandise revenue +$10.1 million YoYΒ 
  • Christmas Spectacular revenues +$3.5 million YoY
  • Advertising sales commission -$9.6 million YoY
  • Direct operating expenses of $115.1 million (+5% YoY)
  • Selling, general, and administrative expenses of $44.1 million (-6% YoY)

It’s also nearing the sale of the “Theater at Madison Square Garden” for roughly $1 billion. The buyer is Italian developer ASTM Group who is currently renovating the famous Penn Station rail hub. However, it must demolish the 5,500-seat theater to continue its expansion plans. πŸ’°

Executives remain optimistic about the new chapter as a standalone, pure-play live entertainment company. To reflect last month’s spin-off from Sphere Entertainment, they refined their fiscal year 2023 outlook. They’re now expecting $835 to $845 million in revenue, $85 to $95 million in operating income, and $145 to $155 million in adjusted operating income. πŸ”Ί

Investors appeared “entertained” by the results as $MSGE shares rose 13% to new highs. πŸ‘

And speaking of entertainment, it’s worth noting some Sony news. The company is reportedly considering a partial spin-off of its financial business as it doubles down on entertainment and image sensors. Did somebody say a Sony shakeup??? πŸ‘€

More in   Earnings

View All

Scholastic Slumps On Book Weakness

Scholastic Corporation shareholders received another chapter of the company’s book. And unfortunately, they didn’t like what they read. ☹️

The education and media company’s first-quarter loss widened, and revenues declined due to continued softness in the retail book market. An adjusted loss per share of $2.20 on revenues of $228.5 million missed analyst expectations of a $1.35 per share loss on $268.8 million in revenues.

Read It

$RENT Gets Another Dent

Investors in subscription fashion service Rent The Runway probably wish they rented shares instead of buying them. That’s because shares fell to fresh all-time lows after another weak quarter. πŸ™ƒ

Its second-quarter loss per share of $0.40 matched analysts expectations. Meanwhile, a 1% YoY revenue decline to $75.7 million missed the $78.1 million expected.

Read It

NetSol Technologies’ New Lows

There aren’t many companies reporting earnings these days, but one that caught our eye today was NetSol Technologies. Unfortunately for investors, it did not grab our attention for a positive reason.

The micro-cap company provides IT and enterprise software solutions to the global automobile financing and leasing, banking, and financial services industries. It released fiscal fourth-quarter earnings today that apparently the market didn’t love.

Read It