SFX Revenue Down, Attendance Up

Some of that decline is attributed in the company’s statement to foreign currency impacts. The bigger hit, though, came from $4 million in lost revenue because of cancellations of events, either partially or in whole, of several festivals during the quarter. Insurance is expected to partially cover those losses.

SFX also attributes some of the revenue decline to a reduction in the volume at Beatport of digital music downloads. Revenue for 2015 YTD grew 18.6 percent over the same point last year to $306.5 million. SFX notes that excluding foreign currency impact, revenue in the nine months ended Sept. 30 increased by $88.3 million, or 34 percent, year over year. Net loss and diluted loss per share for Q3 were $54.5 million and $0.57. At the nine-month point, the losses were $144 million and $1.55 per share.

Pro forma adjusted EBITDA for Q3 and YTD were $3.5 million and $17.1 million, respectively, the company reports. During the quarter, SFX staged 286 festivals and events, including 31 festivals – defined by SFX as events with single-day capacities of over 10,000 attendees (excluding artist tours). Total attendance at festivals and events grew 24.8 percent from the same quarter last year, to 1.95 million attendees. Attendance during the nine-month period rose 36.8 percent over 2014 to 4.1 million.

“Despite continued strong gains in total attendance, the third quarter of 2015 was challenging for SFX in several respects, including the impact of foreign exchange and the cancellation of several festival days to weather,” SFX CEO Robert Sillerman said. “Additionally, the Company’s sales and recognition of revenue from sponsorships did not meet our expectations, which we consider primarily a timing issue. … While our financial performance was impacted by external factors, we are making several significant changes this quarter to address the lower than anticipated operating results.”

Sillerman added that while insurance settlements and finalization of a new marketing agreement will help the bottom line in the fourth quarter, full-year results for 2015 “will not meet our prior expectations.”