Liberty Media is too important a company to ignore. But the Q1 earnings statement out this morning is a jumble after it spun off Starz and formally took control of Sirius XM. It reports net earnings of $8.1B, up from $151M in the quarter last year — almost all of the gains from transactions — on revenues of $789M, up 2,154%. Operating income, a more revealing measure in this case, came in at $160M, up from a $32M loss, while cash flow was +$288M to $271M. Basically the results reflect the generally upbeat Q1 performance of Sirius XM, which reported its results last month. In addition, Liberty says its holdings in Live Nation appreciated 35.2% since the end of 2012 to $668M, while its Barnes & Noble investment was +5% to $275M, and other investments were +7.5% to $887M. CEO Greg Maffei says that Liberty is “extremely pleased with the operating results of our newest subsidiary, Sirius XM, which grew its subscriber base to over 24M.” He adds that following Liberty’s May 1 acquisition of 27.3% in Charter Communications — giving it four board seats there — “we look forward to working with [CEO] Tom Rutledge, his team, and our fellow board members.”
This isn’t a complete surprise following the announcement late last month that Madison Square Garden Executive Chairman Jim Dolan resigned from the Live Nation board. MSG had 3.9M Live Nation shares — about 2% of the …
The announcement, in a Live Nation SEC filing today, offers no explanation for the resignation that it says was tendered Friday and was “effective immediately.” But it follows the surprise year-end resignation of Irving Azoff, who …
Madonna Comeback In Music, TV, And Film: 3-Album Deal With Interscope Worth $40M; First Album In 5 Years Coming Early March; Single Timed To ‘W.E.’ Film And Superbowl
EXCLUSIVE DETAILS: Hollywood knows that, when it comes to Madonna, never count her down and out. Because few performers are as shrewd about their careers as this 53-year-old multi-hyphenate singer, actress, producer, and now film writer and director who has stayed buzz-worthy for three decades. I’ve learned that Interscope Records is releasing her new CD in late March – her first album in 5 years. And “Gimme All Your Luvin”, the first single, is coming out the last week in January just prior to her upcoming Super Bowl XLVI halftime appearance on February 5th. I’ve learned that’s the same week her upcoming Weinstein Company film, W.E., is now scheduled for a wide release on February 3rd. So it becomes clear why Harvey Weinstein delayed Madonna’s movie from December 9th in NY and LA: to take advantage of the early 2012 promotional hype which will surround her and provide him with free marketing. That’s especially useful after reviews of the film she directed and co–wrote about American-born Walllis Simpson’s historic affair with Britain’s King Edward VIII have been lukewarm at best and lousy at worst in the U.S. and UK. Weinstein cancelled its Oscar push. I can also reveal that the 3-album licensing deal which Madonna and Live Nation Entertainment just inked with Interscope Records is valued by my sources at $40M. It’s one component of a broad career comeback developed by Madonna, her long-time manager Guy Oseary, and Live Nation Entertainment executive chairman Irving Azoff.
Investors seemed to like what they heard at today’s annual confab for John Malone’s Liberty Media. Shares of the hodge-podge of companies it either owns or controls were up on a day when the market was shaken by new fears that the European debt crisis will widen. Liberty Starz ended the day +1% and Liberty Capital was +0.5% after their parent said it will combine the two tracking stocks into a single asset-based security. But Live Nation was +6.7%, Barnes & Noble was +5%, and Sirius XM was +4.8% following CEO presentations to the Street.
Malone was more subdued than usual. But the executive who became a billionaire on the back of his devilishly complex deals — often to help him avoid paying taxes — got a chuckle in his response to a question about whether the changes in his tracking stocks will make their businesses confusing for investors. “We’ll get as complicated as we need to get to highlight value.” he said.
Sirius XM’s Mel Karmazin won the biggest laughs, though, with
Like other parts of the music business, there’s a lot of consolidation taking place in talent management — including this announcement today from feisty independent firms Primary Wave and Violator Management. They’ve chosen the unfortunate name of Primary Violator Management for the 50/50 joint venture. Primary Wave’s client list includes CeeLo Green, Ginuwine, Goodie Mob, Eric Benet, Cody Simpson, Case and GMD3. Violator adds Curtis “50 Cent’ Jackson, LL Cool J, Mariah Carey, Busta Rhymes, Q-Tip, Soulja Boy, and Diggy Simmons. Primary Wave CEO Larry Mestel will be in charge. Competition is intensifying: Yesterday, Live Nation Chairman Irving Azoff said he plans to announce a big music management acquisition soon. Here’s today’s release:
New York, N.Y. (September 16th, 2011) – Music industry veteran, Larry Mestel, CEO of Primary Wave Music, one of the largest independent music publishing, marketing, branding and talent management companies in the United States, announces a unique partnership with legendary music manager, Chris Lighty, Founder and CEO of Violator Management to create Primary Violator, a new powerhouse talent management firm. The new business venture will bring together Lighty and elite music manager Michael “Blue” Williams, uniting two of today’s most influential and successful talent managers in urban and pop music.
Curious that the press release (below) doesn’t explicitly say that Azoff is chairman of Live Nation Entertainment — the parent of Ticketmaster and the No. 1 owner of concert venues.
LOS ANGELES, Aug. 4, 2011 — Front Line Management and Syco Entertainment today announced a partnership which will see the future winning artist or group of the U.S. version of The X Factor managed by Front Line Management, the world’s leading artist management group.
Front Line, a division of Live Nation Entertainment, manages the careers of some of the world’s biggest-selling artists, including The Eagles, Miley Cyrus, Journey, New Kids on The Block, Christina Aguilera and Fleetwood Mac.
UPDATE, 1:30 PM: Fear that the economy may be headed back into recession seemed to grow in the last hour of trading. The Dow ended the day -4.3% at 11,383.68. It was the biggest single-day drop since Oct. 22, 2008 and took the Dow below where it was at the beginning of 2011. Similarly, the S&P 500 was -4.8% and NASDAQ was -5.1%.
Although most media companies remain well ahead of where they were a year ago, today’s losses still look ugly. CBS, down 9.3%, was the hardest-hit infotainment giant. Here’s how the other Big Guns fared: News Corp -6.7%, Sony -6.5%, Disney -5.6%, Time Warner -4.6%, Comcast -4.3%, and Viacom -3.4%.
Among other media companies, Comscore finished -38.3% and Westwood One was -13.2%. Sinclair Broadcasting and McClatchy each lost more than 9%. Cinedigm, Live Nation, TiVo, and Liberty Media fell at least 8%. And Yahoo, Best Buy, Barnes & Noble, The New York Times Company, Coinstar, and Dish Network lost at least 7%. Even World Wrestling Entertainment, which had been up earlier in the day, closed -1.4%.
The only company in the sector that gained ground today was Pandora Media. It ended +1.6% after Bank of America Merrill Lynch initiated coverage with a “buy” recommendation.
EXCLUSIVE: This is exactly the kind of information that shareholders of Big Media need to know but rarely see. It’s considered a red flag when any public company pays one of its bigwigs – usually the CEO – three times more than the average for the four other top executives which the SEC requires them to list. So I’ve taken proxy statements and done the computations and discovered that at least 16 of 35 companies failed that test. Often miserably. Nearly half of the media company compensation packages disclosed so far for 2010 show a startling degree of hero-worship as boards of directors pay their top dogs sums that far exceed what the pay was for other top execs in the company.
Stock grants accounted for big chunks of the compensation for those who top this list, including Discovery Communications CEO David Zaslav, Viacom CEO Philippe Dauman, DirecTV CEO Michael White, Nielsen CEO David Calhoun, and CBS chief Les Moonves. Radio station owner Entercom was off the charts: CEO David Field’s $9.1 million compensation was modest by media company standards but still 25.4 times bigger than average for the company’s other four executives. It includes $7.9 million from stock grants that only pay off if Entercom shares rise to hit certain target prices.
Still, corporate governance experts who focus on what’s often called “CEO centrality” say that an out-of-whack pay package is bad news for shareholders. It indicates that the board of directors may be in the pocket of a CEO – or believes he or she has near super-human power to help the company succeed. In either case, the board is likely to give the CEO all the credit when things go well, and blame others when they go badly. Research shows that usually hurts the stock price over time.
I’ll track this and other measures of lop-sided pay as other media companies release information for 2010. But there are a few things to keep in mind: The SEC reporting rules only cover the top-paid executives of publicly traded U.S. companies. That means we probably won’t know how much privately held Hearst pays CEO Frank Bennack, or how much Japan’s Sony pays CEO Howard Stringer. It also means that we’ll miss a lot of highly paid people who work at subsidiaries of a big company; Universal Studios’ Ron Meyer may be a big deal in Hollywood, but he was a relatively small fish last year at parent company General Electric.
To make comparisons in our list here as fair as possible, we looked at the compensation for the five most highly paid employees for 2010. Sometimes companies report the pay for more than five people — for example, when a top executive is replaced during the year a corporation will include the incoming and outgoing person’s compensation. And the pay data given the SEC can spike in a year when an executive cashes in stock or collects deferred compensation. So here’s how the companies stack up, with the top paid executive’s 2010 reported compensation and comparison to the average (median) pay for the four other highest-paid honchos:
1. Entercom: David Field. The son of company founder Joseph Field became CEO in 2002, about 15 years after leaving his job as an investment banker at Goldman Sachs. Field made $9.1 million last year – the total of his $791,723 salary, $444,308 bonus, $7.9 million in stock, and $28,000 in other perks including medical insurance premiums. That’s a 348% raise in a year when company shares appreciated 53.2%. Though considered a strong operating executive, his salary stands out because it’s 25.4 times higher than the $358,692 average for the four other top executives listed in Entercom’s proxy statement. Field’s salary and the $3.9 million paid to CFO Stephen Fisher accounted for 93% of the $14 million that Entercom paid to its top five executives.