Eventim Counts Cost Of LN Fight

Ticketing giant CTS Eventim has admitted the cost of its legal battle with Live Nation over the U.S. company’s merger with Ticketmaster is having a significant impact on its balance sheet.

The ad hoc press release published Nov. 17 – detailing 2010 earnings up to Sept. 30 – says one of the reasons the Bremen-based company’s growth has been “constrained” is “the legal consultancy relating to the Live Nation arbitration proceedings.”

“Cost of acquisitions” is the other major factor that “significantly lowered” the EBIT by euro 8.8 million from euro 53 million to euro 44.2 million, and the EBITDA by euro 4.4 million from euro 60 million to euro 55.6 million.

At press time it wasn’t possible to get clarification from Eventim communications director Rainer Appel on exactly how much of the lost earnings were because of acquisitions and how much was a result of the LN legal battle.

The company’s major acquisition of 2010 – the $183.5 million purchase of See Tickets Germany and Ticket Online Group – has been stalled by the country’s monopoly authority’s investigation.

Appel told Pollstar Eventim didn’t “choose a route” when bringing a breach of contract suit against Live Nation but was adhering to the escalation procedure agreed in that contract.

After what the ticket giant described as the “special effects” from the cost of acquisitions and legal squabbles, Eventim’s preliminary report for the first nine months of 2010 shows earnings before tax, interest and amortization were up 10.1 percent to euro 55.6 million.

Without the “special effects,” they would have been up 18.9 percent to euro 60 million.

The ticketing section, where Eventim’s been taking the hit, had an EBITDA of euro 34.7 million – rather than the euro 39.2 million it would have had otherwise.

Figures that don’t need any adjusting say Eventim’s European ticket revenues are up by nearly one-third to euro 123.9 million and internet ticket sales – the company’s high-profit line – rose at about the same rate to 10.7 million.

The live music sector, the Medusa Group promoters that include Dirk Becker, Folkert Koopmans, Marek Lieberberg, Norbert Link, Peter Rieger, and Dieter Semmelmann, produced revenues 7.3 percent up, to euro 253 million.

Earnings before tax, interest and amortization are 5.3 percent up to euro 20.8 million.