CTS Eventim: ‘Strong start to 2022 is cause for optimism’
CTS Eventim says its strong start to 2022 is cause for optimism that live entertainment will make a “robust comeback” this year.
“Concert and festival venues are finally coming back to life,” exclaims CEO of CTS Eventim, Klaus-Peter Schulenberg, as the company’s Q1 financial results are revealed.
The lifting of coronavirus-related restrictions in the company’s core markets meant that revenue in the ticketing and live entertainment segments increased substantially in the first quarter of 2022 compared with the same period of last year.
The results show that consolidated revenue improved to €139.2 million in the first fiscal quarter of 2022 (previous year: €19.6m). While normalised EBITDA (earnings before interest, taxes, depreciation and amortisation) came to €23.7m (previous year: €-19.6m).
In the ticketing segment, revenue rose to €76.5m in the first three months of 2022 (previous year: €13.5m). Normalised EBITDA was back in the black at €27.2m (previous year: €-13.4m).
“Ticket sales in April – and so far in May too – have been well above the level seen in the same period of 2019… a record year”
Revenue in the live entertainment segment improved year on year to reach €65.1m in the first quarter of 2022 (previous year: €6.8m). Normalised EBITDA amounted to €-3.5m (previous year: €-6.2m).
“We are delighted that ticket sales in April – and so far in May too – have been well above the level seen in the same period of 2019, which had been a record year,” continues Schulenberg.
“This underpins the hope that the live entertainment sector will really bounce back after an enforced two-year break due to coronavirus. The live entertainment business ramped up again in our European markets and overseas much sooner than in Germany, where coronavirus restrictions were lifted relatively late.”
The company says it received “positive news” at the beginning of this year when an arbitration tribunal decided that autoTicket – a joint venture between CTS and Kapsch TrafficCom – is entitled to claim for compensation and reimbursement of expenses from the Federal Republic of Germany.
Also in 2022, CTS announced a partnership with France Billet to provide ticketing software and related services for the 2024 Olympic and Paralympic Games in Paris. The company expects the contribution to revenue to be in the double-digit millions.
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DEAG on the road to recovery after strong 2021
Deutsche Entertainment (DEAG) has reported a strong fourth quarter and a significant increase in revenue and earnings in the financial year 2021.
The Berlin-based live entertainment group saw its revenue hit €91 million in 2021, up 82% from €49.9m in 2020.
In addition, EBITDA (earnings before interest, taxes, depreciation and amortisation) rose by 144% from €9m in 2020 to €22.1m in 2021.
DEAG says the increases in earnings and revenue are down to “a significant upturn in operating activities” in the second half of 2021.
The promoter and ticket agency owns businesses in Germany, Switzerland, the Republic of Ireland and the UK – which has been fully open since last summer.
“DEAG has weathered the pandemic comparatively well over the past two years, which have not been easy for the entire live entertainment industry due to Covid-19,” says professor Peter Schwenkow. “We stand on strong legs, have successfully continued our expansion course in Germany and Europe and are currently experiencing an increasing return to normal for our business activities in all our core markets and high demand for tickets for concerts and events.”
“We are excellently positioned for future growth with our broad portfolio of events and our strong financial position”
Last year, the company delisted from the stock market after 23 years as a listed company, with CEO Peter Schwenkow telling IQ that DEAG could raise more funds as a private company than on the financial markets.
The company later announced it raised more than €6m to fund future acquisitions in “key markets” such as literary events production company Fane Productions in the UK.
“We are excellently positioned for future growth with our broad portfolio of events and our strong financial position,” continues Schwenkow. “Our ticket sales are at an above-average level and we have started the current year with plenty of tailwind.
“In the UK, booking levels are already back to pre-crisis levels and in our other core markets they are approaching 2019 levels again, the year before the corona pandemic broke out. We will offer visitors hundreds of events over the next few months and set off event fireworks.”
Schewnkow recently told IQ the company was seeing a 50-80% increase in ticket sales compared to pre-pandemic.
In view of the recovery in its core markets, strong ticket sales and growth from the companies acquired in 2021, DEAG says it expects a significant improvement in EBITDA and further revenue increases in 2022.
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CTS Eventim’s annual revenue soared in 2021
CTS Eventim has reported a 60% increase in annual revenue during 2021.
The Munich-based pan-European promoter and ticketing company saw consolidated revenue rise by 58.8% to €407.8 million, compared to €256.8m in 2020.
According to CTS, the increase was driven mainly by a resurgence in ticket sales, with artists such as Ed Sheeran, Genesis and Udo Lindenberg among the bestsellers.
“The number of events on offer in our ticketing systems is increasing with each new day – a clear sign of growing confidence within the events industry, and we anticipate that festivals and large-open air events will begin to resume from the second quarter onwards, after an enforced break of two years,” says Klaus Peter Schulenberg, CEO of CTS Eventim.
The financial results also revealed a normalised EBITDA (earnings before interest, taxes, depreciation and amortisation) for 2021, rising to €208m (previous year: loss of €2.9m).
“The number of events on offer in our ticketing systems is increasing with each new day”
CTS chalks this up to cost savings, an improved operating business and extensive government aid of around €157m.
Consolidated revenue for the fourth quarter of 2021, meanwhile, was up to €227.8m, compared with €28.1m in the equivalent period of the previous year. Normalised EBITDA for the quarter amounted to €102.6m (previous year: €14.8m).
In the ticketing segment, revenue for 2021 as a whole improved by 77% to €224.1m (previous year: €126.6m). Normalised EBITDA stood at €177.1m, following a loss of €23.6m in 2020. In the fourth quarter of 2021, there was an increase in revenue to €113.5m (previous year: €19.5m), while normalised EBITDA rose to €85.8m (previous year: loss of €11.0m).
Annual revenue in the live entertainment segment advanced by 39.7% in 2021 to reach €191.1m (previous year: €136.8m). Normalised EBITDA for the segment came to €30.9m (previous year: €20.7m). In the last three months of the reporting year, revenue generated by live entertainment improved to €117.0m, compared with €9.5m in the final quarter of 2020. The segment’s normalised EBITDA for the fourth quarter totalled €16.8m (previous year: €25.8m).
“These financial results provide further evidence of the strength and financial stability of the group,” says Schulenberg. “2021 was also a year in which key strategic initiatives strengthened our international position.”
“These financial results provide further evidence of the strength and financial stability of the group”
In the same year, the live entertainment giant also acquired software and hardware developer Simply-X and regional ticketing providers Kölnticket and Bonnticket.
In addition, the tickets for Ed Sheeran’s European tour were the first to be sold by CTS Eventim exclusively through its proprietary digital ticket, Eventim.Pass.
Elsewhere, EMC Presents, a joint venture established with US promoter Michael Cohl in 2020, organised the group’s first tour in the US at the end of 2021 with Genesis as the headline act.
The company says it is “optimistic” about its prospects for 2022 after two pandemic-hit years, and believes it is “well-positioned” for a restart of the live entertainment sector.
At the time of writing, CTS Eventim’s share price is up 1.38% to €60.06.
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Endeavor shares first annual financials since IPO
WME parent company Endeavor has shared financial results for the fourth quarter, and fiscal year, of 2021 – the company’s first since going public in April 2021.
Endeavor, which also owns sports agency IMG and the Ultimate Fighting Championship (UFC), among other properties, generated revenue of US$1.5 billion for the fourth fiscal quarter of 2021 and a net loss of $16.7m.
For the full year, Endeavor generated $5.1bn in revenue but posted a net loss of $467.5m.
“In our first year as a public company, we saw significant outperformance across our portfolio as the world began to emerge from the pandemic, with increased attendance at live events and continued heightened demand for premium content,” said Ariel Emanuel, CEO, Endeavor.
“Given the unique position we occupy in the content landscape, we remain confident about our ability to continue leveraging trends, unlocking growth, and delivering long-term value.”
“In our first year as a public company, we saw significant outperformance across our portfolio as the world began to emerge from the pandemic”
The agency’s representation business (comprising WME, IMG and Endeavor Content) proved to be a bright spot for Endeavor’s financials, reporting revenue of $717.9m for the quarter, up $443.2m, or 161%, compared to the prior-year quarter. For the full year, the business was up $2bn, up 100% from the $1bn realised by the segment in 2020.
WME artists include Drake, Justin Timberlake, Adele, Bruno Mars, Pearl Jam, Kendrick Lamar, the Killers, Bjork, Frank Ocean, Foo Fighters, St Vincent, Shakira and more.
Endeavor’s Events, Experiences & Rights segment revenue topped $156m in the quarter, up 23% year over year and $2.0bn for the year, up $437.8m, or 28%, compared to the prior year – driven by the return of live events among other things.
Meanwhile, Endeavor’s owned sports properties segment reported revenue of $277.3m for the fourth quarter, up $8.3m, or 3%, compared to the prior-year quarter. For the full year, revenue for the segment was up by 16% to $1.1bn, when measured against the prior year.
For 2022, Endeavor is projecting revenue between $5.2bn and $5.45bn.
Glastonbury reports £3.1m loss in latest accounts
The UK’s Glastonbury festival posted a loss of £3.1 million for the year ending March 2021, according to documents posted on Companies House.
The event was forced to cancel due to the pandemic for a second successive year in 2021. Turnover was down to £936,000, compared to £45.867m in the previous 12 months. Post-tax losses amounted to £370,330 in 2020.
“Since 2009, the company has retained profits in order to provide a float for the next festival,” says the documents. “Due to the company retaining profits in previous years to build up this float, the company was able to cover the significant loss incurred resulting from the Covid pandemic and the cancellation of the festival in 2020 as well as contribute to running costs during 2021 when the festival was cancelled for the second year.”
The documents for Glastonbury Festival Events Limited list its main business risks as “possible breaches of the licence terms leading to the licence being withdrawn and the cancellation of the festival due to forces outside the control of the company such as extremely bad weather and a global pandemic”.
There are likely to be “significant costs specifically related to necessary Covid-19 measures and related issues” for the 2022 edition
Glastonbury hosted an exclusive global livestream from its Worthy Farm festival site on 22 May last year, featuring performances from the likes of Coldplay, Jorja Smith and George Ezra, in lieu of the flagship event. However, the initial broadcast was marred by technical issues.
Glastonbury is due to return to Worthy Farm this year from 22-26 June, with Billie Eilish the first and so far only headliner to be announced. The report notes there are likely to be “significant costs specifically related to necessary Covid-19 measures and related issues” for the 2022 edition.
“The company has been fortunate enough to receive Arts Council funding since March 2021 year end, which has helped with future planning during the year to date,” adds the firm, which also organises two much smaller events, Pilton Party and Glastonbury Extravaganza.
DEAG rebounds as UK business boosts Q3 earnings
Berlin-based Deutsche Entertainment Group AG (DEAG) has reported a 126% increase in sales for Q3 2021, thanks largely to the performance of its UK business.
After the first six months of the year were severely impacted by the pandemic, sales in the third quarter soared from €4 million to €16.7m, while EBITDA rose by 617% from €600,000 to €4.3m.
The upturn is mostly attributed to the UK, DEAG’s operating most important market outside Germany, where concerts are already taking place again at full capacity. Its Kilimanjaro Live subsidiary has organised sold-out concerts and tours by the likes of Gorillaz in the region. The first events have also been held in Germany.
Sales revenues amounted to €24.1m whereas, in the nine-month period in 2020 when the first quarter was only slightly affected by the pandemic, revenues were €39.1m.
DEAG and the entire live entertainment industry are finally gaining momentum again
“DEAG and the entire live entertainment industry are finally gaining momentum again after well over a year without concerts and events,” says company CEO Peter Schwenkow. “We look forward to offering our visitors hundreds of concerts and events in the months to come and expect to achieve a significant increase in earnings in the fourth quarter.
“In the meantime, the situation with the epidemic in Europe is leading to a daily reassessment of the current situation in all national markets. We are adequately protected against possible risks arising for us from the currently rising corona figures by extensive measures taken by the respective country governments and our insurance coverage. Our very robust financial position and a uniquely high event density for 2022 show our excellent positioning for growth in the coming year.”
The group also credits its ticketing platforms, the companies acquired in 2021 as part of DEAG’s acquisition and integration strategy, together with the provision of new services, for the improved performance. In addition, it mentions the enormous cost-cutting programme in the group as well as inflows from subsidy programmes, which DEAG has taken advantage of in all national markets, and its continued full insurance coverage.
DEAG, which reports strong advance sales for events in 2022, has expanded its successful Christmas Garden format to 18 locations – eight of them in other European countries – in the 2021/2022 season. New additions in Germany include Cologne, Frankfurt/Main and Hanover, as well as internationally in Paris, Barcelona and Windsor Park in London.
“Based on these, the significant revival in the UK and growth impulses from the companies acquired in 2021, DEAG expects another significant increase in earnings with high visibility in the fourth quarter of 2021,” concludes the report.
Last week, Munich-based live entertainment giant CTS Eventim posted “encouraging” financial results for Q3 2021, powered by improved ticket sales.
CTS Eventim reports strong Q3 results
Live entertainment giant CTS Eventim has posted “encouraging” financial results for Q3 2021, powered by improved ticket sales.
The Munich-based pan-European promoter and ticketing company saw consolidated revenue rise by 279.2% to €114.7 million, compared with €30.2m in the same period last year. Revenue for 2021 to date fell 21.3% year-on-year to €180m, since Q1 2020 was barely affected by the pandemic.
Revenue from the company’s live entertainment segment soared by 351.2% to €55.7m in the third quarter of 2021 (up from €12.4m in the equivalent period last year), while ticketing surged 225.5% to €61m, compared with €18.7m in Q3 2020.
Ticket sales accelerated at the start of the second half of 2021, boosted by presales for tours by major international artists including Ed Sheeran, Genesis and Coldplay, as well as German rock act Udo Lindenberg.
Around 400,000 tickets have been sold for Sheeran’s German dates alone, the firm reports. However, the coronavirus situation meant the number of events was still down sharply compared with pre-pandemic levels.
We recorded an encouraging increase in revenue in the third quarter
“We recorded an encouraging increase in revenue in the third quarter,” says CTS Eventim CEO Klaus-Peter Schulenberg. “In recent months, we have also forged ahead with our international expansion plans and ensured that CTS Eventim is even better prepared for the future by launching new digital products.”
Normalised EBITDA was €105.4m compared to a loss of €17.7 million 12 months earlier. The firm attributes the turnaround to “cost savings, an improved operating business and the government aid programmes introduced in Germany and other countries”.
CTS received “extraordinary” Covid-19 financial aid from the German federal government for November and December 2020, with €102m in government funding awarded “to strengthen the result for the current financial year and the company’s liquidity”.
Last month, CTS strengthened its position in the access control market with the acquisition of software and hardware developer Simply-X, one of the leading providers of event management products in Germany. The firm also announced its expansion into the North American ticketing market in September.
At the time of writing, CTS’ share price was down 2.64% to €62.04.
CTS Eventim ‘optimally positioned’ for reopening
CTS Eventim’s Q2 financial results show that the company is “optimally positioned for the return of live entertainment,” according to CEO, Klaus-Peter Schulenberg.
In the period from April to June 2021, the Munich-based company’s revenue was up sharply compared with Q2 2020, primarily thanks to an uptick in ticket sales.
In the second quarter of 2021, ticketing revenue went up by 283.7%, from €9.4 million to €36.1m. Normalised EBITDA (earnings before interest, taxes, depreciation and amortisation) amounted to €77.6m (previous year: loss of €18.2m). This included around €73m in German coronavirus support.
Before the outbreak of the coronavirus pandemic, around 250 million tickets per annum were marketed using the company’s systems, which include online portals under brands such as eventim.de, oeticket.com, ticketcorner.ch, ticketone.it, and entradas.com.
The company’s live music revenue also improved in the second quarter of 2021, jumping by 81.5% year on year to €11.5m (previous year: €6.3m). Normalised EBITDA amounted to €21.4m (previous year: €1.9m). German coronavirus support contributed around €29m to earnings.
“Ticket sales are recovering, which confirms our view that people are yearning for live entertainment after the pandemic”
“Ticket sales are recovering, which confirms our view that people are yearning for live entertainment after a year and a half of the pandemic,” said Schulenberg. “However, politicians must set out a framework so that it is economically viable for events to be held again. The government support is very helpful but the industry wants to finally be able to earn its money by returning to work.”
He added: “CTS Eventim has taken the coronavirus crisis as an opportunity to further strengthen and broaden its market position by undertaking a number of major strategic initiatives. Going forward, we will be better positioned than ever before, especially internationally, to be able to impress our customers with our services, industry expertise and technology in the live entertainment business.”
During the pandemic, the pan-European live entertainment giant continued the expansion of its Eventim Live promoter network, establishing the Gadget abc Entertainment Group in Switzerland, partnering with legendary US promoter Michael Cohl, and acquiring a majority stake in the Barracuda Group in Austria.
In 2021, CTS acquired Berlin-based promoter DreamHaus, led by Matt Schwarz, taking the network up to 36 promoters in 15 countries.
The company recently announced plans to build a new €180 million arena in Milan, northern Italy.
DEAG minimises losses in first half of 2020
German live entertainment group DEAG has managed to cap its losses at €300,000 in the first half of the year, according to the company’s half-year earnings report.
Despite the widespread economic impact of coronavirus, the company has minimised its losses as a result of a “massive cost-cutting programme” and €9 million in insurance payouts, with another €5.1 million in the settlement process.
DEAG (Deutsche Entertainment AG), which owns My Ticket and Gigantic, also reported that sales in the first half of the year amounted to €31.7 million (previous year €63.9m) and to €5.6m (previous year: €38.4m) in the second quarter.
In the second quarter, the company managed to save more than 30% compared to the first quarter of 2020.
“We are satisfied with the economic result in the first half of 2020 against the backdrop of the drastic restrictions imposed by Covid-19 on us. Above all, we are demonstrating operationally that DEAG can develop and implement successful events in any market environment, provided the regulatory framework allows it,” says Peter Schwenkow, CEO of DEAG.
“Due to DEAG’s strong financial resources, the time scale of the crisis is not the main focus of our considerations”
DEAG’s report says its relatively smooth six months is down to the company’s swift pivot to new event formats.
According to the report, electronic festival Nature One made its virtual debut in August to an audience of 4.5 million users.
While the drive-in event, BW-Bank Kulturwasen in Stuttgart, has been extended until the end of September.
The company also cites Stage Drive in Frankurt and virtual reality format TimeRide as successful projects.
“I am extremely grateful to all our employees not only for their ideas, but also for their motivation and commitment to our cost reduction and efficiency programmes. Our enormous efforts are proving to be a great success. Due to DEAG’s strong financial resources, the time scale of the crisis is not the main focus of our considerations,” continues Schwenkow.
“On the contrary, our dense calendar of events for 2021, many millions of tickets sold and already more than €100m in contracted revenues at the end of the first half of the year make us very optimistic. For the vast majority of these revenues in the coming year, we also have full insurance coverage again, including cancellation due to force majeure.”
According to the company, nearly 90% of customers have indicated that they will keep their tickets for postponed events. At the end of the first half of the year, DEAG had already sold a total of around 2.5m tickets in Germany, Switzerland and the UK (including Scotland).
Share price holds steady in difficult Q2 for Live Nation
Live Nation’s second-quarter earnings report depicts a tough period for the live entertainment group. With few live events taking place worldwide, LN has reported a 98% drop in revenue and US$665 million loss during the quarter.
The company’s revenue for the quarter was $74m compared to $3.2 billion last year – even after gradually reducing costs for this year by over $800m – taking the company’s current debt to $4.9bn with a weighted average cost of 4.4%.
The loss includes refunds issued by the company’s ticketing platform, Ticketmaster, which reimbursed money for 11m tickets across 42,000 shows and generated a loss of approximately $79m.
However, the company’s share price has been on a steady incline since the end of June, increasing from $42.64 to current value of $47.64, and its CEO Michael Rapino is optimistic about the future.
Speaking during Live Nation’s latest earnings call at 5pm ET (9pm GMT) yesterday (5 August), Rapino said the company will be focusing on new revenue streams around keeping fans connected to artists, citing the potential for livestreaming to become a long-term component of the business.
“Virtual concerts have proven to be a huge demand with fans, so we established a live-from-home platform to provide a convenient place for fans of all types to find the performances from their favourite artists,” he says.
“Virtual concerts have proven to be a huge demand with fans, so we established a live-from-home platform for fans to find the performances from their favourite artists”
LN had 67m fans see over 18,000 concerts and festivals globally, the vast majority of them online, in the second quarter – most recently the virtual Lollapalooza festival.
Though LN has launched socially distant shows when and where permitted, in New Zealand, France, Denmark, Spain, Germany, Finland and as well as cities across the US, Rapino says he expects live events to return properly in summer 2021.
On the call, the CEO expressed confidence in the fans’ desire to attend shows in the future despite uncertainty, reporting that 86% of concert fans are keeping their tickets for rescheduled shows.
However, it seems LN is still planning for a potentially tough festival season in 2021. In early June, a memo was leaked outlining the company’s intention to update its contract terms for artists.
The memo, sent to booking agency partners, proposed changes including a 20% reduction in guarantees from 2021 levels, minimum requirements for marketing activity and a stipulation that artists hold their own cancellation insurance in the event that the festival does not go ahead.
However, on the earnings call, Rapino said “the press got a hold of a work in progress,” and that largely the memo was a “wish list of things”.
“Artists keep calling me daily saying, ‘When can I go? When’s it going to be safe? When are we going to go?’”
“We wanted to make sure that going into 2021, if you are a headline artist that was going to play a certain festival this year and [both LN and the artist] wanted you to play it next year, the two things we wanted to make sure that we were protected in, and that we both shared some of the risk, was a refund reduction and insurance,” he clarified,
“Those are the two principles, if you take all the drama from the press, aside those are the two things we wanted to make sure that we weren’t stuck paying the same price in 2020 if we had a 31% refund rate on a festival.”
Despite the devastating impact Covid-19 has had on Live Nation’s, and the wider industry’s, business, Rapino told investors touring had “not had a structural change”, with both fans and artists keen to get back to shows as soon as it’s safe to do so.
“Artists keep calling me daily saying, ‘When can I go? When’s it going to be safe? When are we going to go? I am dying to go. I got new music. I want to drop new music,’” he added.
“So I think this is why we believe long term – regardless of what quarter we exactly scale at – that the business will be stronger than ever, with the creative push by all these artists who need to get on the road to drive their new music.”