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MSG Buys LA’s Forum Arena For $23.5M

By | Tuesday June 26, 2012 @ 9:38am PDT

The Madison Square Garden Co has struck a deal with the City of Ingelwood and the Faithful Central Bible Church to buy the iconic LA venue for $23.5 million and plans to begin renovations this year — promising a redo along the lines of the company’s refurbishments of its NY venues Radio City Music Hall, the Beacon Theatre and most recently Madison Square Garden. The purchase gives MSG high-profile live-event venues on each coast, joining NY’s The Garden. Miller Tabak analyst David Joyce welcomed the deal, saying the Forum should be a “good economic West Coast outpost” for live music events, which also can help [MSG's] Fuse music network. The Forum deal announced today includes commitments from the company including annual minimum ticket sales guarantees, providing local hiring opportunities, and rent-free uses of the the arena by the city for charitable causes and the parking lot for a weekly farmers market. Read More »

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Madison Square Garden Fiscal Q3 Earnings Score On Rising Pay TV Fees And Sports

By | Friday May 4, 2012 @ 5:25am PDT

The owner of major entertainment venues, cable channels, and sports teams including the New York Knicks says it had one of its best quarters as a public company in the first three months of this year — although that’s not such a huge milestone considering it’s only been on the stock exchange for two years. It generated $31.1M in net income, up 62.8% vs the period last year, on revenues of $400.5M, up 21.2%. The revenue figure was well ahead of the $352.7M that analysts predicted. And earnings, at 40 cents a share, slam dunked the 18 cents that the Street expected. Revenues at the Media unit, which includes regional sports networks MSG and MSG+, were up 13% to $166.2M. That’s due in part to the resolution of the blackout on Time Warner Cable; it resisted MSG’s price hikes until public pressure from Knicks fans who wanted to see the historic scoring spree by point guard Jeremy Lin became too strong to resist. MSG’s affiliate fees were up for the quarter, even though it was off Time Warner Cable for about half of the period. Ad sales also were up. Revenues at the Entertainment division — which includes venues such as Radio City Music Hall and The Chicago Theater — fell 20% to $34.3M. The company says that was largely due to the NBA work stoppage, and the company’s inability to quickly schedule events to make up for the … Read More »

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Madison Square Garden Soars As Jeremy Lin Scores

The live entertainment and cable network company’s shares are hitting record highs as even non-basketball fans become fascinated with New York Knicks point guard Jeremy Lin’s historic scoring streak. MSG’s at $32.24 in midday trading, up 3.5% vs Friday — and +11.3% so far in the month of February. The timing couldn’t be better for MSG Chairman Jim Dolan. The company — which owns the Knicks, the Garden, and regional sports channels MSG and MSG+ — needed a good story to tell after last year’s NBA work stoppage contributed to a dreary year-end financial report. And if Lin-sanity continues, then it could give Dolan the upper hand in his showdown with Time Warner Cable. Due to a contract dispute, MSG’s channels have been dark on the cable system since the beginning of the year. Time Warner Cable balked at MSG’s price demands, and also wants to drop MSG’s low-rated Fuse music channel. Dolan took a huge risk by holding out: Time Warner Cable accounts for about 2.5M MSG subscribers, about a third of its total. The $112M that the cable company pays annually for the channels amounts to about half of Madison Square Garden’s estimated cash flow for its current fiscal year. The company said last week that no talks with the cable provider have been scheduled. But Time Warner Cable may find itself playing defense if many of the basketball fans among its New York customers decide to switch to a different … Read More »

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Madison Square Garden’s Fiscal Q2 Was Lousy, But Better Than Expected

By | Wednesday February 8, 2012 @ 5:17am PST

Madison Square Garden was benched by last year’s NBA work stoppage: That meant fewer games for its New York Knicks, fewer ticket sales, and less advertising for its MSG Networks. The channel’s absence on Time Warner Cable, the result of a contract dispute, just added to MSG’s woes. For the last three months of 2011 the company had net income of $25.6M, down 21.7% vs the previous year, on revenues of $373M, down 13.8%. So where’s the silver lining? Analysts expected things to be worse. The revenue figure was well ahead of the $358M they anticipated. Earnings at 33 cents a share also exceeded the 24 cents that was forecast. MSG Networks saw its total revenues fall 1.2% to $142.4M as the decline in ads and the losses from the Time Warner Cable dispute were partly offset by higher affiliate fees from other pay TV providers. MSG Entertainment, which includes the company’s concert venues and performances, was down 14.8% to $151.2M. Madison Square Garden says that there were fewer performances of the Radio City Christmas Spectacular shows outside of New York — and last year had Cirque du Soleil: Wintuk. Meanwhile, MSG Sports, which includes the company’s sports franchises, fell 31.2% to $88.6M. “Looking ahead, we remain confident in our Company’s long-term growth opportunities due to our unique and valuable content,” CEO Hank Ratner says.

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How Much Financial Pain Will Jim Dolan Endure At MSG To Beat Time Warner Cable?

The fear for a lot of investors is that Madison Square Garden Chairman Jim Dolan has too many agendas that will lead him to avoid compromising with Time Warner Cable in their dispute over payments for channels including regional sports powers MSG and MSG+. Madison Square Garden shares fell 1.4% today — a contrast to the overall market which was up about 1.6% — after Dolan yanked the services from Time Warner Cable on New Year’s Day when their carriage contract expired. The companies remain far apart on terms, and don’t even have plans to resume negotiations. That’s a big risk for MSG: Time Warner Cable accounts for about 2.5M MSG subscribers, about a third of its total. The $112M that the cable company pays annually for the channels amounts to about half of Madison Square Garden’s estimated cash flow for its current fiscal year. But execs close to both companies say that Dolan is determined to show that he’s no pushover. The part time blues guitarist knows he’d probably have to kiss MSG’s music channel Fuse goodbye if he allows Time Warner Cable to drop it — something the pay TV company says it wants to do because so few people watch it. Dolan’s main job as CEO of Cablevision gives him an additional incentive to show his moxie. Time Warner Cable has long pined to Read More »

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Media Stocks Caught In Downdraft As Fears Of European Default Grow

The trading day ended with a thud. The benchmark Standard & Poor’s 500 wound up -2.1% as word spread that Germany might balk at a proposal to help bail out debt-laden members of the European Union including Greece and Portugal. That affected media stocks; the Dow Jones U.S. Media Index fell 3%. Disney was the hardest hit among the Big Guns, with shares off 3.2%. It was followed by News Corp (-3.1%), CBS (-3%), Comcast (-2.9%), Time Warner (-2.7%), Viacom (-2.3%), and Sony (-2.1%). Newspaper companies were big losers led by McClatchy (-10%), New York Times (-7.3%), E.W. Scripps (-6.5%), and Gannett (-6.3%). But others weren’t far behind: Cablevision (-6.1%) hit a 52-week low. The losers list also included Crown Media (-6.6%), AOL (-5.9%), DirecTV (-4.7%), Live Nation (-4.4%), Barnes & Noble (-4.3%), TiVo (-4.2%), Sirius XM (-4.2%) and Dish Network (-4.2%). Today’s few gainers were led by Coinstar, up 7.8% on a report that its Redbox unit will team up with Verizon to offer an online video service. Martha Stewart Living Omnimedia was up 1.7% the day after J.C. Penney said it bought 16.6% of the company. And Madison Square Garden was up 1.7%, hitting a 52-week high, after Morgan Stanley’s Benjamin Swinburne changed his recommendation to “overweight” from “underweight” following the resolution of the NBA lockout.

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UPDATE: Madison Square Garden Scrambles For Concerts To Replace Lost NBA Games

UPDATE, 8:10 AM: MSG CEO Hank Ratner told analysts that he can’t say much about the lockout “in light of (NBA) league restrictions.” But it has created problems. “We are exploring opportunities to bring other live events to the Garden” to replace the lost games, he says. It’s been tough to do so at the last minute, though. Ratner has scheduled two performances and adds that “we’re going to use the influence that we have as Madison Square Garden to schedule as many dates as we can.” Can companies that have bought suites at the Garden cancel them? The company says not to worry — but won’t give specifics. Season-ticket holders can get refunds, including for the eight Knicks home dates that have been lost. MSG is required to send the cash out within 10 days and include a 1% annual interest rate payment retroactive to October 1. The company says the lost games won’t cause its sports TV channels to run afoul of its cable and satellite affiliation agreements. The deals have provisions for work stoppages; hockey and Knicks-related programs will fill in for some of the lost games. MSG Media President Mike Bair says that “the vitality of the market for hockey has been better than last year and better than our plan.” Meanwhile the company continues to upgrade the Garden, and says the total bill should come to $980M.

PREVIOUS, 5:42 AM: We’ll have to wait for the company’s quarterly conference call with analysts to find out what how badly the NBA lockout might hurt the owner of the New York Knicks, MSG regional sports networks, and the Madison Square Garden arena. There was no mention of it in this morning’s earnings report. But the disruption follows a strange quarter as the company closed Madison Square Garden and the Theater at Madison Square Garden for upgrades. MSG reported net income of $21.3M, up 10.5% vs the same period last year, on revenues of $177.6M, down 6.9%. The revenue figure was well ahead of the $173.88M that analysts expected. And earnings, at 28 cents a share, zoomed past the 10 cents the Street anticipated. Read More »

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MSG Earnings Decline With The Garden Out Of The Game

By | Friday August 26, 2011 @ 11:42am PDT

Madison Square Garden Co reported a second-quarter profit that was down 39% thanks to ongoing renovations at the company’s Madison Square Garden arena and theater in New York, which has put a crimp on hosting lucrative events. The James Dolan-run MSG, which went public last year after being spun off from Cablevision Systems, saw revenue improve 3% to $233.9 million, beating Wall Street expectations, led in part by higher affiliate fees at the MSG Media unit, which includes MSG Network, Fuse and regional sports networks. It’s MSG Entertainment that took the brunt of the decline with its biggest venue unavailable (construction is expected to be completed in October). Overall, the company reported a profit of $8.5 million, or 11 cents a share; analysts expected 14 cents a share. Of course, analysts also expect things could get much worse if the NBA season is shortened or canceled owing to the current owner-imposed lockout — that’s 41 home New York Knicks games that are in jeopardy (MSG owns the Knicks as well as the NHL’s New York Rangers and the WNBA’s New York Liberty). The stock is down about 11% this year so far but was up following the earnings report.

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