• Revenue Growth: Up 15% year-to-date.
• Adjusted EBITDA Growth: Increased by 21% year-to-date.
• Cash and Liquid Investments: $3.7 billion at quarter end.
• Debt: $2.9 billion principal amount at quarter end.
• Adjusted EBITDA Margin: Improved from 24.4% to 25.8% through Q3 2024.
• Attendance: 5.8 million fans attended Grand Prix races through Brazil.
• F1 TV Subscriber Growth: Up 10% year-over-year.
• Interest Rate Swaps: $2.4 billion of debt at a fixed rate.
• Leverage: Expected to be between 3.4x to 4x post MotoGP acquisition.
• Team Payments: 62.2% of pre-tax income year-to-date through Q3.

• Warning! GuruFocus has detected 3 Warning Signs with UP.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Liberty Formula One Group (NASDAQ:FWONA) reported a 15% increase in revenue and a 21% rise in adjusted EBITDA year-to-date, showcasing strong financial performance.
• The company has seen double-digit growth across all revenue streams, supported by two additional races and new partnerships.
• Liberty Formula One Group (NASDAQ:FWONA) successfully refinanced its term loan, reducing the margin on its Term Loan B from 2.25% to 2%, with potential further reductions.
• The company has signed several new commercial agreements, including a groundbreaking 10-year deal with LVMH, enhancing its sponsorship portfolio.
• Attendance at MotoGP events is up 9% year-to-date, with six races setting all-time attendance records, indicating strong fan engagement.

Negative Points

• Sponsorship revenue declined in the third quarter due to lower pro rata revenue recognition and the mix of races.
• The Valencia MotoGP race was canceled due to flooding, impacting the season's schedule and potentially affecting revenue.
• The Las Vegas Grand Prix ticket revenue is expected to be down from initial budget projections, although costs have been reduced.
• There is uncertainty surrounding the media rights renewal with ESPN, with negotiations still ongoing.
• The company faces challenges in maintaining profitability in the Las Vegas market, which is characterized by high volatility in ticket sales.

Q & A Highlights

Q: Can you provide any updates on the Concorde Agreement negotiations and the expected timing? A: Gregory Maffei, President and CEO, stated that there is no urgent rush as there is still plenty of time in Q4. Conversations are progressing well, and the ecosystem is solid. The focus is on getting it right, and they are progressing at a good pace with the expectation that everyone will sign with satisfaction.

Q: How do you view the sponsorship revenue growth outlook for Formula One in the coming years? A: Gregory Maffei, President and CEO, mentioned that 2025 is expected to be a banner year with new and expanded agreements. There is a strong interest from high-value market partners, and they are restructuring deals to exploit market opportunities. The future looks very positive for sponsorship growth.

Q: What are your thoughts on the sports media rights landscape heading into the US renewal next year? A: Gregory Maffei, President and CEO, noted that ESPN has been a great partner, and there is interest from other partners. The goal is to balance economics and reach, providing the best experience for fans. Streaming will be a major component of future sports rights packages.

Q: Can you provide more details on the demand and expectations for the Las Vegas Grand Prix? A: Renee L. Wilm, Chief Legal Officer & Chief Administrative Officer, explained that they are focused on quality and experience, optimizing the product ladder, and adjusting products and pricing based on market feedback. There is an uptick in traffic and conversion rates around ticket sales, and they expect continued growth as the race weekend approaches.

Q: How are you thinking about race promotion and the race calendar in 2026? A: Stefano Domenicali, President and CEO of Formula One Group, stated that they have a long-term deal with Madrid and are working with promoters to ensure high standards. There is a large demand for new venues, and they are balancing economic benefits with market potential to grow the business further.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.