MSG 2Q Profit Drops 39 Percent

Sporting, media and entertainment company The Madison Square Garden Co. said Friday its second-quarter earnings sank 39 percent, as a renovation project that closed its famous arena and theater for much of the quarter affected revenue.

The New York company earned $8.5 million, or 11 cents per share, in the three months that ended June 30. That compares to net income of $14 million, or 18 cents per share, in the same quarter last year. Revenue grew 3 percent to $233.8 million.

Analysts surveyed by FactSet expect, on average, earnings of 13 cents per share on $222.2 million in revenue.

The company’s MSG Entertainment revenue dropped 23 percent to $36 million in the quarter, mainly due to lower event-related revenue from Madison Square Garden and the Theater at Madison Square Garden. The famous Manhattan arena is getting an $850 million upgrade that includes gutting its interior from the ground up.

The upgrade is scheduled to be completed in 2013. Workers plan to finish the first phase — which includes building wider concourses and replacing lower-level seats — and re-open the Garden before the fall start of the NBA and NHL seasons for the New York Knicks and Rangers.

MSG Media revenue climbed 4 percent to $139.6 million, and MSG Sports revenue rose 18 percent to $75.4 million, mainly due to higher playoff-related revenue. MSG Sports owns and operates the Knicks, Rangers, the WNBA’s New York Liberty and the Connecticut Whale minor league hockey team.

In morning trading, shares of the company slipped 15 cents to $22.69.