Liberty(FWONA) - 2024 Q4 - Annual Results

Overall Financial Results and Highlights This section outlines CEO Derek Chang's 2025 strategic priorities and key business highlights, including F1 fan growth and Live Nation's $9.0 billion valuation CEO Statement & Strategic Priorities New CEO Derek Chang highlighted strategic priorities for 2025, including capitalizing on Formula 1's growth, closing the MotoGP acquisition, and addressing the Liberty Live structure, with a commitment to driving shareholder value - Strategic priorities for 2025 include leveraging F1's success, acquiring MotoGP, and optimizing the Liberty Live structure[1] - The date for regulatory approval of the MotoGP acquisition has been extended to June 30, 2025[2] Key Business Highlights In 2024, Formula One Group saw a 9% increase in fan attendance and renewed several key race promotion and partnership agreements. Liberty Live Group's investment in Live Nation was valued at $9.0 billion at year-end - F1 fan attendance reached 6.5 million in 2024, a 9% increase from 2023, with 1.6 billion cumulative TV viewers[2] - F1 renewed multiple race promotion agreements, including long-term deals for the Chinese (through 2030), Italian, and Monaco Grands Prix (both through 2031)[2] - The fair value of the Live Nation investment, attributed to Liberty Live Group, was $9.0 billion as of December 31, 2024[2] Formula One Group Financial Performance This section details Formula One Group's financial performance, covering overall revenue and operating income trends, alongside F1's operating results and profitability analysis Overall Financial Results (Formula One Group) For the full year 2024, Formula One Group's revenue increased to $3.65 billion from $3.22 billion in 2023, while operating income slightly decreased to $287 million. The fourth quarter saw a decline in both revenue and operating income compared to the prior year Formula One Group Financial Summary (in millions) | | Three months ended Dec 31, | | Twelve months ended Dec 31, | | :--- | :--- | :--- | :--- | :--- | | | 2023 | 2024 | 2023 | 2024 | | Total Revenue | $1,230 | $1,167 | $3,222 | $3,653 | | Total Operating Income | $122 | $23 | $297 | $287 | | Total Adjusted OIBDA | $243 | $200 | $686 | $774 | F1 Operating Results F1 achieved record full-year revenue and Adjusted OIBDA in 2024, driven by growth in sponsorship, media rights, and race promotion fees from an expanded 24-race calendar. However, Q4 results declined due to lower proportionate revenue recognition and reduced income from the Las Vegas Grand Prix compared to its inaugural year F1 Revenue Analysis Full-year 2024 F1 revenue grew 6% to $3.41 billion, with Primary F1 revenue up 8% due to increases in sponsorship, media rights, and fees from two additional races. Q4 revenue fell 8% to $1.13 billion, primarily due to lower race promotion and media rights income F1 Revenue Performance (in millions) | | Three months ended Dec 31, 2024 | % Change | Twelve months ended Dec 31, 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | | Primary F1 revenue | $797 | (5)% | $2,757 | 8% | | Other F1 revenue | $329 | (16)% | $654 | (1)% | | Total F1 revenue | $1,126 | (8)% | $3,411 | 6% | - For FY 2024, primary revenue streams were race promotion (29.3%), media rights (32.8%), and sponsorship (18.6%)[11] - Full-year primary revenue growth was driven by new sponsors, contractual fee increases, and two additional races (China and Imola)[13] - Q4 primary revenue decreased due to lower ticketing revenue from the Las Vegas Grand Prix and lower proportionate recognition of season-based media rights fees (6/24 races in Q4 2024 vs. 6/22 in Q4 2023)[14] F1 Operating Income and Adjusted OIBDA Analysis For the full year 2024, F1's operating income rose 26% to $492 million and Adjusted OIBDA grew 9% to $791 million, despite higher team payments and operating costs associated with the expanded calendar. Q4 operating income and Adjusted OIBDA decreased by 18% and 15% respectively, driven by lower revenue F1 Profitability (in millions) | | Three months ended Dec 31, 2024 | % Change | Twelve months ended Dec 31, 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | | Adjusted OIBDA | $202 | (15)% | $791 | 9% | | Operating income | $126 | (18)% | $492 | 26% | - Full-year operating income and Adjusted OIBDA grew. Team payments increased due to higher F1 revenue, but as a percentage of pre-team payment Adjusted OIBDA, they decreased from 62.6% in 2023 to 61.5% in 2024[16] - Q4 operating income and Adjusted OIBDA decreased primarily due to the decline in revenue, partially offset by lower team payment costs[18] Corporate and Other Operating Results Corporate and Other revenue and Adjusted OIBDA grew in both the fourth quarter and full year 2024, primarily due to the inclusion of Quint's results and rental income from the Las Vegas Grand Prix Plaza - Revenue growth was driven by the inclusion of Quint's results and rental income from the Las Vegas Grand Prix Plaza, which amounted to $13 million in Q4 and $33 million for the full year[19] - Quint's revenue is seasonal, with the second and fourth quarters being the largest, driven by F1 Experiences[19] Liberty Live Group The Liberty Live Group primarily consists of an investment in Live Nation, valued at $9.0 billion at year-end 2024, an increase from $7.6 billion at the end of Q3 2024. The group was allocated $11 million in corporate expenses for the full year - The businesses and assets attributed to Liberty Live Group consist primarily of Liberty Media's interest in Live Nation and other minority investments[21] Fair Value of Live Nation Investment (in millions) | Date | Fair Value | | :--- | :--- | | 9/30/2024 | $7,625 | | 12/31/2024 | $9,019 | Capital Management This section reviews Liberty Media's capital management, including share repurchase activity and the cash and debt positions of the Formula One and Liberty Live Groups Share Repurchases Liberty Media did not repurchase any of its common stock between November 1, 2024, and January 31, 2025. The company has $1.1 billion remaining in its repurchase authorization as of February 1, 2025 - No share repurchases occurred from November 1, 2024, to January 31, 2025[22] - The total remaining repurchase authorization is $1.1 billion as of February 1, 2025, applicable to any of Liberty Media's tracking stocks[22] Cash and Debt Position As of December 31, 2024, Formula One Group held $2.63 billion in cash and $2.91 billion in debt. Liberty Live Group held $325 million in cash and $1.15 billion in debt. Both entities were in compliance with their debt covenants Cash and Debt Summary as of Dec 31, 2024 (in millions) | Attributed Group | Cash & Cash Equivalents | Total Debt | | :--- | :--- | :--- | | Formula One Group | $2,631 | $2,908 | | Liberty Live Group | $325 | $1,150 | - Formula One Group's cash decreased by $35 million in Q4 due to seasonal working capital changes and capital expenditures, while debt remained relatively flat[30] - Liberty Live Group's cash decreased by $63 million in Q4 due to debt reduction and interest payments. Debt decreased by $50 million due to the settlement of exchangeable senior debentures[31] Consolidated Financial Statements This section presents Liberty Media's consolidated financial statements, including the balance sheet, statement of operations, and statement of cash flows Balance Sheet As of December 31, 2024, Liberty Media reported total consolidated assets of $12.95 billion and total liabilities of $5.90 billion. The Formula One Group accounted for the majority of assets ($11.76 billion) and liabilities ($4.37 billion) Consolidated Balance Sheet Summary as of Dec 31, 2024 (in millions) | | Amount | | :--- | :--- | | Total current assets | $3,347 | | Total assets | $12,948 | | Total current liabilities | $1,133 | | Total liabilities | $5,897 | | Total equity | $7,051 | Statement of Operations For the full year 2024, Liberty Media reported total revenue of $3.65 billion, all attributed to the Formula One Group, resulting in a consolidated operating income of $276 million. The company posted a net loss attributable to stockholders of $2.06 billion, heavily impacted by a large loss from discontinued operations (Liberty SiriusXM Group) 2024 Statement of Operations Summary (in millions) | | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Total revenue | $3,653 | $3,572 | | Operating income | $276 | $255 | | Net earnings (loss) from continuing operations | ($63) | ($24) | | Net earnings (loss) from discontinued operations | ($2,412) | $986 | | Net earnings (loss) attributable to Liberty stockholders | ($2,063) | $761 | - Liberty SiriusXM Group, which was combined with SiriusXM on September 9, 2024, is presented as a discontinued operation, contributing a net loss of $2.41 billion for FY 2024[38] Statement of Cash Flows For the twelve months ended December 31, 2024, Liberty Media generated $553 million in net cash from operating activities. Net cash used in investing activities was $187 million, while financing activities provided a net cash inflow of $894 million, largely due to the issuance of Series C Liberty Formula One common stock 2024 Statement of Cash Flows Summary (in millions) | | FY 2024 | | :--- | :--- | | Net cash provided by operating activities | $553 | | Net cash used by investing activities | ($187) | | Net cash provided by financing activities | $894 | | Net increase in cash | $935 | Non-GAAP Financial Measures This section defines and reconciles Adjusted OIBDA, a key non-GAAP financial measure, for both the Formula One Group and Liberty Live Group Adjusted OIBDA Reconciliation The company uses Adjusted OIBDA (Operating Income Before Depreciation & Amortization) as a key performance indicator. For the full year 2024, Formula One Group's Adjusted OIBDA was $774 million, reconciled from an operating income of $287 million. Liberty Live Group's Adjusted OIBDA was a loss of $7 million - Adjusted OIBDA is defined as operating income (loss) plus depreciation and amortization, stock-based compensation, separately reported litigation settlements, restructuring, acquisition and other related costs and impairment charges[47] Adjusted OIBDA Reconciliation (in millions) | | 4Q24 | 2024 | | :--- | :--- | :--- | | Formula One Group | | | | Operating income (loss) | $23 | $287 | | Adjusted OIBDA | $200 | $774 | | Liberty Live Group | | | | Operating income (loss) | ($4) | ($11) | | Adjusted OIBDA | ($3) | ($7) |