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Atlanta Braves Holdings Reports Third Quarter 2023 Financial Results

Atlanta Braves Holdings, Inc. (“Atlanta Braves Holdings”) (Nasdaq: BATRA, BATRK) today reported third quarter 2023 results.

Headlines include(1):

  • Total revenue grew 11% to $272 million in third quarter
    • Baseball revenue up 11% to $256 million
    • Mixed-use development revenue up 10% to $16 million
  • Mixed-use development generated $11 million of Adjusted OIBDA(2) in third quarter
  • Atlanta Braves secured sixth consecutive NL East Title
  • 54 game sellouts and 3.2 million tickets sold for 2023 season

Corporate Updates

On July 18, 2023, Liberty Media Corporation (“Liberty Media”) completed the split-off of the Braves and its associated mixed-use development (the “Split-Off”) into the separate public company Atlanta Braves Holdings. The businesses and assets at Atlanta Braves Holdings consist of Braves Holdings, LLC, the owner and operator of the Atlanta Braves Major League Baseball Club, and certain assets and liabilities associated with the Braves’ ballpark and mixed-use development, called The Battery Atlanta, which were previously attributed to the Braves Group tracking stock of Liberty Media. For purposes of this presentation, Atlanta Braves Holdings standalone results, assets and liabilities represent the combination of the historical financial information of the Braves Group until the date of the Split-Off. Although Atlanta Braves Holdings was reported as a combined company until the date of the Split-Off, it is now a consolidated company and all periods reported in this presentation are referred to as consolidated.

Discussion of Results 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

 

 

 

Nine months ended

 

 

 

 

 

September 30,

 

 

 

 

 

September 30,

 

 

 

 

 

2022

 

2023

 

% Change

 

 

2022

 

2023

 

% Change

 

 

amounts in thousands

 

 

 

 

 

amounts in thousands

 

 

 

Baseball revenue

 

$

231,279

 

 

$

256,266

 

 

11

 

%

 

 

$

478,037

 

 

$

528,762

 

 

11

 

%

Mixed-use development revenue

 

 

14,168

 

 

 

15,558

 

 

10

 

%

 

 

 

39,265

 

 

 

44,157

 

 

12

 

%

Total revenue

 

 

245,447

 

 

 

271,824

 

 

11

 

%

 

 

 

517,302

 

 

 

572,919

 

 

11

 

%

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baseball operating costs

 

 

(194,216

)

 

 

(198,195

)

 

(2

)

%

 

 

 

(390,027

)

 

 

(430,424

)

 

(10

)

%

Mixed-use development costs

 

 

(2,089

)

 

 

(2,247

)

 

(8

)

%

 

 

 

(6,399

)

 

 

(6,451

)

 

(1

)

%

Selling, general and administrative, excluding stock-based compensation

 

 

(24,626

)

 

 

(31,037

)

 

(26

)

%

 

 

 

(73,519

)

 

 

(84,686

)

 

(15

)

%

Adjusted OIBDA

 

$

24,516

 

 

$

40,345

 

 

65

 

%

 

 

$

47,357

 

 

$

51,358

 

 

8

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

(4,692

)

 

$

15,716

 

 

NM

 

 

 

 

$

(23,371

)

 

$

(14,074

)

 

40

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regular season home games in period

 

 

38

 

 

 

37

 

 

 

 

 

 

 

79

 

 

 

80

 

 

 

 

Unless otherwise noted, the following discussion compares financial information for the three months ended September 30, 2023 to the same period in 2022.

Baseball revenue is derived from two primary sources on an annual basis: (i) baseball event revenue (ticket sales, concessions, advertising sponsorships, suites and premium seat fees) and (ii) broadcasting revenue (national and local broadcast rights). Mixed-use development revenue is derived from the Battery Atlanta mixed-use facilities and primarily includes rental income.

The following table disaggregates revenue by segment and by source:

 

 

Three months ended

 

 

 

 

 

Nine months ended

 

 

 

 

 

September 30,

 

 

 

 

 

September 30,

 

 

 

 

 

2022

 

2023

 

% Change

 

 

2022

 

2023

 

% Change

 

 

amounts in thousands

 

 

 

 

 

amounts in thousands

 

 

 

Baseball:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Baseball event

 

$

134,941

 

$

160,794

 

19

 

%

 

 

$

281,144

 

$

324,280

 

15

 

%

Broadcasting

 

 

66,901

 

 

69,337

 

4

 

%

 

 

 

130,646

 

 

138,786

 

6

 

%

Retail and licensing

 

 

17,590

 

 

20,904

 

19

 

%

 

 

 

39,200

 

 

45,026

 

15

 

%

Other

 

 

11,847

 

 

5,231

 

(56

)

%

 

 

 

27,047

 

 

20,670

 

(24

)

%

Baseball revenue

 

 

231,279

 

 

256,266

 

11

 

%

 

 

 

478,037

 

 

528,762

 

11

 

%

Mixed-use development

 

 

14,168

 

 

15,558

 

10

 

%

 

 

 

39,265

 

 

44,157

 

12

 

%

Total revenue

 

$

245,447

 

$

271,824

 

11

 

%

 

 

$

517,302

 

$

572,919

 

11

 

%

There were 37 regular season home games played in the third quarter of 2023 compared to 38 regular season home games in the prior year period.

Baseball revenue increased 11% in the third quarter. Baseball event and retail and licensing revenue grew primarily due to increased ticket demand and attendance at regular season home games. Broadcasting revenue increased due to contractual rate increases. Other revenue declined due to fewer concerts at the ballpark compared to the prior year period. Mixed-use development revenue increased 10% during the third quarter due to increases in rental income related to tenant recoveries and various new lease agreements, as well as higher sponsorship revenue.

Operating income and Adjusted OIBDA increased in the third quarter. Revenue growth more than offset increased baseball operating costs due to higher player salaries and minor league team and player expenses. Selling, general and administrative expense increased during the third quarter primarily driven by costs related to the Split-Off.

FOOTNOTES

1)

Atlanta Braves Holdings will be available to answer questions related to these headlines and other matters on Liberty Media Corporation’s earnings conference call that will begin at 10:00 a.m. (E.T.) on November 3, 2023. For information regarding how to access the call, please see “Important Notice” later in this document.

2)

For a definition of Adjusted OIBDA (as defined by Atlanta Braves Holdings) and the applicable reconciliation, see the accompanying schedule.

Important Notice: Atlanta Braves Holdings (Nasdaq: BATRA, BATRK) will be available to answer questions on Liberty Media Corporation’s third quarter earnings conference call which will begin at 10:00 a.m. (E. T.) on November 3, 2023. The call can be accessed by dialing (877) 704-2829 or (215) 268-9864, passcode 13736986 at least 10 minutes prior to the start time. The call will also be broadcast live across the Internet and archived on our website. To access the webcast go to https://www.bravesholdings.com/investors/news-events/ir-calendar. Links to this press release will also be available on the Atlanta Braves Holdings website.

This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, product and marketing strategies, future financial performance and prospects, and other matters that are not historical facts. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, Atlanta Braves Holdings’ ability to recognize anticipated benefits from the split-off, possible changes in the regulatory and competitive environment in which Atlanta Braves Holdings operates (including an expansion of MLB), the unfavorable outcome of pending or future litigation, operational risks of Atlanta Braves Holdings and its business affiliates, including operations outside of the U.S., Atlanta Braves Holdings’ indebtedness and its ability to obtain additional financing on acceptable terms and cash in amounts sufficient to service debt and other financial obligations, tax matters, compliance with government regulations and potential adverse outcomes of regulatory proceedings, changes in the nature of key strategic relationships with broadcasters, partners, vendors and joint venturers, the impact of organized labor, the performance and management of the mixed-use development and the impact of inflation and weak economic conditions on consumer demand. These forward-looking statements speak only as of the date of this press release, and Atlanta Braves Holdings expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Atlanta Braves Holdings’ expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Please refer to the publicly filed documents of Atlanta Braves Holdings, including Amendment No. 5 to the Registration Statement on Form S-4 filed by Atlanta Braves Holdings with the Securities and Exchange Commission on June 8, 2023, the Registration Statement on Form S-1 filed by Atlanta Braves Holdings with the Securities and Exchange Commission on September 8, 2023, and the most recent Form 10-Q, for additional information about Atlanta Braves Holdings and about the risks and uncertainties related to Atlanta Braves Holdings’ business which may affect the statements made in this press release.

NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTAL DISCLOSURES

SCHEDULE 1: Reconciliation of Adjusted OIBDA to Operating Income (Loss)

To provide investors with additional information regarding our financial results, this press release includes a presentation of Adjusted OIBDA, which is a non-GAAP financial measure, for Atlanta Braves Holdings together with reconciliations to operating income, as determined under GAAP. Atlanta Braves Holdings defines Adjusted OIBDA as operating income (loss) plus depreciation and amortization, stock-based compensation, separately reported litigation settlements, restructuring, acquisition and impairment charges.

Atlanta Braves Holdings believes Adjusted OIBDA is an important indicator of the operational strength and performance of its businesses by identifying those items that are not directly a reflection of each business’ performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. Because Adjusted OIBDA is used as a measure of operating performance, Atlanta Braves Holdings views operating income as the most directly comparable GAAP measure. Adjusted OIBDA is not meant to replace or supersede operating income or any other GAAP measure, but rather to supplement such GAAP measures in order to present investors with the same information that Atlanta Braves Holdings’ management considers in assessing the results of operations and performance of its assets.

The following table provides a reconciliation of Adjusted OIBDA for Atlanta Braves Holdings to operating income (loss) calculated in accordance with GAAP for the three and nine months ended September 30, 2022 and September 30, 2023.

 

 

Three months ended

 

Nine months ended

 

 

September 30,

 

September 30,

(amounts in thousands)

 

2022

 

2023

 

2022

 

2023

Operating income (loss)

 

$

(4,692

)

 

$

15,716

 

 

$

(23,371

)

 

$

(14,074

)

Impairment of long-lived assets and other related costs

 

 

4,811

 

 

 

34

 

 

 

4,811

 

 

 

564

 

Stock-based compensation

 

 

3,062

 

 

 

3,309

 

 

 

9,188

 

 

 

9,653

 

Depreciation and amortization

 

 

21,335

 

 

 

21,286

 

 

 

56,729

 

 

 

55,215

 

Adjusted OIBDA

 

$

24,516

 

 

$

40,345

 

 

$

47,357

 

 

$

51,358

 

Baseball

 

$

18,072

 

 

$

36,918

 

 

$

28,653

 

 

$

38,796

 

Mixed-use development

 

 

9,696

 

 

 

10,661

 

 

 

26,093

 

 

 

29,980

 

Corporate and other

 

 

(3,252

)

 

 

(7,234

)

 

 

(7,389

)

 

 

(17,418

)

SCHEDULE 2: Cash and Debt

The following presentation is provided to separately identify cash and debt information. Atlanta Braves Holdings cash decreased $24 million during the third quarter due to cash used in operations primarily due to seasonal working capital changes, as well as capital expenditures, partially offset by the release of restricted cash pursuant to the terms of various financial debt arrangements and net borrowing. Atlanta Braves Holdings debt increased $16 million in the third quarter primarily due to borrowings under the TeamCo revolver and mixed-use development credit facilities.

(amounts in thousands)

 

June 30, 2023

 

September 30, 2023

Atlanta Braves Holdings Cash (GAAP)(a)

 

$

130,537

 

 

$

106,715

 

 

 

 

 

 

Debt:

 

 

 

 

 

 

Baseball

 

 

 

 

 

 

League wide credit facility

 

$

 

 

$

 

MLB facility fund - term

 

 

30,000

 

 

 

30,000

 

MLB facility fund - revolver

 

 

43,125

 

 

 

41,400

 

TeamCo revolver

 

 

 

 

 

10,000

 

Term debt

 

 

168,561

 

 

 

165,370

 

Mixed-use development

 

 

301,127

 

 

 

312,399

 

Total Atlanta Braves Holdings Debt

 

$

542,813

 

 

$

559,169

 

Deferred financing costs

 

 

(4,118

)

 

 

(3,898

)

Total Atlanta Braves Holdings Debt (GAAP)

 

$

538,695

 

 

$

555,271

___________________

a)

Excludes restricted cash held in reserves pursuant to the terms of various financial obligations of $52 million and $20 million as of June 30, 2023 and September 30, 2023, respectively.

ATLANTA BRAVES HOLDINGS

CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION

September 30, 2023 (unaudited)

 

 

September 30,

 

December 31,

 

 

2023

 

2022

 

 

amounts in thousands

 

 

except share amounts

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

106,715

 

 

150,664

 

Restricted cash

 

 

19,814

 

 

22,149

 

Accounts receivable and contract assets, net of allowance for credit losses

 

 

99,095

 

 

70,234

 

Other current assets

 

 

18,224

 

 

24,331

 

Total current assets

 

 

243,848

 

 

267,378

 

 

 

 

 

 

 

Property and equipment, at cost

 

 

1,061,776

 

 

1,007,776

 

Accumulated depreciation

 

 

(312,286

)

 

(277,979

)

 

 

 

749,490

 

 

729,797

 

 

 

 

 

 

 

Investments in affiliates, accounted for using the equity method

 

 

105,614

 

 

94,564

 

Intangible assets not subject to amortization:

 

 

 

 

 

Goodwill

 

 

175,764

 

 

175,764

 

Franchise rights

 

 

123,703

 

 

123,703

 

 

 

 

299,467

 

 

299,467

 

 

 

 

 

 

 

Other assets, net

 

 

120,420

 

 

99,455

 

Total assets

 

$

1,518,839

 

 

1,490,661

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

68,339

 

 

54,748

 

Deferred revenue and refundable tickets

 

 

106,120

 

 

104,996

 

Current portion of debt

 

 

7,786

 

 

74,806

 

Other current liabilities

 

 

7,056

 

 

6,361

 

Total current liabilities

 

 

189,301

 

 

240,911

 

 

 

 

 

 

 

Long-term debt

 

 

547,485

 

 

467,160

 

Redeemable intergroup interests

 

 

 

 

278,103

 

Finance lease liabilities

 

 

106,751

 

 

107,220

 

Deferred income tax liabilities

 

 

56,682

 

 

54,099

 

Pension liability

 

 

10,712

 

 

15,405

 

Other noncurrent liabilities

 

 

32,257

 

 

28,253

 

Total liabilities

 

 

943,188

 

 

1,191,151

 

Equity:

 

 

 

 

 

Preferred stock, $.01 par value. Authorized 50,000,000 shares; zero shares issued at September 30, 2023 and December 31, 2022

 

 

 

 

 

Series A common stock, $.01 par value. Authorized 200,000,000 shares; issued and outstanding 10,318,202 and zero at September 30, 2023 and December 31, 2022, respectively

 

 

103

 

 

 

Series B common stock, $.01 par value. Authorized 7,500,000 shares; issued and outstanding 977,795 and zero at September 30, 2023 and December 31, 2022, respectively

 

 

10

 

 

 

Series C common stock, $.01 par value. Authorized 200,000,000 shares; issued and outstanding 50,427,249 and zero at September 30, 2023 and December 31, 2022, respectively

 

 

504

 

 

 

Additional paid-in capital

 

 

1,088,517

 

 

 

Former parent’s investment

 

 

 

 

732,350

 

Accumulated other comprehensive earnings (loss), net of taxes

 

 

(3,510

)

 

(3,758

)

Retained earnings (deficit)

 

 

(522,018

)

 

(429,082

)

Total stockholders' equity/former parent's investment

 

 

563,606

 

 

299,510

 

Noncontrolling interests in equity of subsidiaries

 

 

12,045

 

 

 

Total equity

 

 

575,651

 

 

299,510

 

Commitments and contingencies

 

 

 

 

 

Total liabilities and equity

 

$

1,518,839

 

 

1,490,661

 

ATLANTA BRAVES HOLDINGS

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS INFORMATION

September 30, 2023 (unaudited)

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2023

 

2022

 

2023

 

2022

 

 

 

amounts in thousands, except per share amounts

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

Baseball revenue

 

$

256,266

 

231,279

 

$

528,762

 

478,037

 

Mixed-use development revenue

 

 

15,558

 

14,168

 

 

44,157

 

39,265

 

Total revenue

 

 

271,824

 

245,447

 

 

572,919

 

517,302

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

Baseball operating costs

 

 

198,195

 

194,216

 

 

430,424

 

390,027

 

Mixed-use development costs

 

 

2,247

 

2,089

 

 

6,451

 

6,399

 

Selling, general and administrative, including stock-based compensation

 

 

34,346

 

27,688

 

 

94,339

 

82,707

 

Impairment of long-lived assets and other related costs

 

 

34

 

4,811

 

 

564

 

4,811

 

Depreciation and amortization

 

 

21,286

 

21,335

 

 

55,215

 

56,729

 

 

 

 

256,108

 

250,139

 

 

586,993

 

540,673

 

Operating income (loss)

 

 

15,716

 

(4,692)

 

 

(14,074)

 

(23,371)

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(9,657)

 

(7,999)

 

 

(28,017)

 

(20,528)

 

Share of earnings (losses) of affiliates, net

 

 

12,725

 

9,975

 

 

23,384

 

22,118

 

Realized and unrealized gains (losses) on intergroup interests, net

 

 

(20,392)

 

(30,940)

 

 

(83,178)

 

5,163

 

Realized and unrealized gains (losses) on financial instruments, net

 

 

2,593

 

5,778

 

 

5,672

 

12,238

 

Gains (losses) on dispositions, net

 

 

15

 

68

 

 

2,518

 

20,283

 

Other, net

 

 

1,209

 

161

 

 

2,863

 

329

 

Earnings (loss) before income taxes

 

 

2,209

 

(27,649)

 

 

(90,832)

 

16,232

 

Income tax benefit (expense)

 

 

(8,256)

 

(2,248)

 

 

(2,104)

 

(5,465)

 

Net earnings (loss)

 

$

(6,047)

 

(29,897)

 

$

(92,936)

 

10,767

 

Basic net earnings (loss) attributable to Series A, Series B and Series C Atlanta Braves Holdings, Inc. shareholders per common share

 

$

(0.10)

 

(0.48)

 

$

(1.51)

 

0.17

 

Diluted net earnings (loss) attributable to Series A, Series B and Series C Atlanta Braves Holdings, Inc. shareholders per common share

 

$

(0.10)

 

(0.48)

 

$

(1.51)

 

0.17

 

 

ATLANTA BRAVES HOLDINGS

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS INFORMATION

September 30, 2023 (unaudited)

 

 

Nine months ended

 

 

 

September 30,

 

 

 

2023

 

2022

 

 

 

amounts in thousands

 

Cash flows from operating activities:

 

 

 

 

 

 

Net earnings (loss)

 

$

(92,936)

 

10,767

 

Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

55,215

 

56,729

 

Stock-based compensation

 

 

9,653

 

9,188

 

Impairment of long-lived assets

 

 

 

4,811

 

Share of (earnings) losses of affiliates, net

 

 

(23,384)

 

(22,118)

 

Realized and unrealized (gains) losses on intergroup interests, net

 

 

83,178

 

(5,163)

 

Realized and unrealized (gains) losses on financial instruments, net

 

 

(5,672)

 

(12,238)

 

(Gains) losses on dispositions, net

 

 

(2,518)

 

(20,283)

 

Deferred income tax expense (benefit)

 

 

(6,086)

 

(2,111)

 

Cash receipts from returns on equity method investments

 

 

12,350

 

14,850

 

Other charges (credits), net

 

 

4,856

 

2,041

 

Net change in operating assets and liabilities:

 

 

 

 

 

 

Current and other assets

 

 

(67,475)

 

(22,628)

 

Payables and other liabilities

 

 

11,513

 

5,543

 

Net cash provided by (used in) operating activities

 

 

(21,306)

 

19,388

 

Cash flows from investing activities:

 

 

 

 

 

 

Capital expended for property and equipment

 

 

(45,313)

 

(13,174)

 

Cash proceeds from dispositions

 

 

 

47,840

 

Investments in equity method affiliates and equity securities

 

 

(125)

 

(5,273)

 

Other investing activities, net

 

 

110

 

 

Net cash provided by (used in) investing activities

 

 

(45,328)

 

29,393

 

Cash flows from financing activities:

 

 

 

 

 

 

Borrowings of debt

 

 

52,248

 

134,753

 

Repayments of debt

 

 

(38,997)

 

(235,368)

 

Payments to settle intergroup interests

 

 

 

(13,828)

 

Contribution from noncontrolling interest

 

 

12,045

 

 

Other financing activities, net

 

 

(4,946)

 

(5,135)

 

Net cash provided by (used in) financing activities

 

 

20,350

 

(119,578)

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

 

(46,284)

 

(70,797)

 

Cash, cash equivalents and restricted cash at beginning of period

 

 

172,813

 

244,113

 

Cash, cash equivalents and restricted cash at end of period

 

$

126,529

 

173,316

 

 

Contacts

Shane Kleinstein (720) 875-5432

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