Endeavor Group Announces First Quarter 2023 Financial Results

On Tuesday, Endeavor announced its first quarter 2023 financial results.

The Endeavor Group, which is set to acquire WWE later this year, sent out the following press release to tout their earnings:

ENDEAVOR RELEASES FIRST QUARTER 2023 RESULTS
Announces Plan to Repurchase Shares and Issue First-Ever Quarterly Dividend
Endeavor Group Holdings, Inc. (NYSE: EDR) (“Endeavor”, “EGH”, or the “Company”), a global sports and entertainment company, today released its financial results for the quarterly period ended March 31, 2023.

Highlights
* Announced two significant transactions in April:
** Transformational deal to combine UFC and WWE to form a new, publicly listed company
** Agreement to sell IMG Academy for an enterprise value of $1.25 billion
* Expect to commence an event-driven share repurchase of up to $300 million of Class A common stock
* Plan to begin making quarterly cash dividend payments
* Record Q1 revenue and Adjusted EBITDA for Owned Sports Properties segment
* Saw heightened demand for events, including record attendance and sponsorship sales at the Miami Open

Q1 2023 Consolidated Financial Results
* Revenue: $1.597 billion
* Net income: $36.3 million
* Adjusted EBITDA: $306.4 million

“This quarter, we continued to deliver solid results and set a number of financial and attendance records across our owned sports properties and marquee events,” said Ariel Emanuel, CEO, Endeavor. “Our agreement to sell IMG Academy, together with the planned share repurchase and quarterly dividend announced today, are strong examples of our commitment to maximizing return for our shareholders. We are excited about the unique opportunity the proposed combination of UFC and WWE presents, and remain focused on durable growth as we continue to execute our successful strategy in content and experiences.”

Segment Operating Results
* Owned Sports Properties segment revenue was $353.3 million for the quarter, up $56.6 million, or 19.1%, compared to the first quarter of 2022. Growth was primarily driven by an increase in media rights fees, sponsorships, commercial pay-per-view, and event-related revenue at UFC, primarily resulting from an additional Pay-Per-View event in the quarter, as well as more events with live audiences. Segment results also improved on increased ticket sales at PBR and increased revenue from PBR’s new team series. The segment’s Adjusted EBITDA was $185.7 million, up $36.9 million, or 24.8%, year-over-year.
* Events, Experiences & Rights segment revenue was $800.8 million for the quarter, up $19.9 million, or 2.5%, compared to the first quarter of 2022. Growth was primarily driven by record attendance and sponsorship sales at the Miami Open and growth at IMG Academy, as well as the addition this quarter of Barrett-Jackson, which was acquired in August 2022. Growth was partially offset by the discontinuation of On Location’s music festival business in Mexico, which accounted for $75 million in the prior-year quarter. The segment’s Adjusted EBITDA was $108.0 million for the quarter, down $18.0 million, or 14.3%, year-over-year.
* Representation segment revenue was $350.2 million for the quarter, down $7.1 million, or 2.0%, compared to the first quarter of 2022. The decrease in segment revenue was primarily attributable to $14 million of revenue recorded in the prior year quarter from the restricted Endeavor Content business, which was sold in January 2022. Segment revenue was also impacted by a decrease at our 160over90 business due to the disposition of certain contracts in the quarter, partially offset by revenue increases at WME. Adjusted EBITDA was $84.2 million for the quarter, down $17.5 million, or 17.2%, year-over-year.
* Sports Data & Technology segment revenue was $100.9 million, up $55.8 million, or 123.9%, compared to the first quarter of 2022. Growth was driven by the addition of OpenBet, which we acquired in September 2022, as well as growth at IMG ARENA. The segment’s Adjusted EBITDA was $4.5 million for the quarter, down $2.0 million, or 31.0%, year-over-year, which was affected by certain costs at IMG ARENA incurred in advance of the sales cycle.

2023 Full Year Guidance
* Revenue expected between $5.665 billion and $5.815 billion
* Adjusted EBITDA expected between $1.220 billion to $1.275 billion
* Updated guidance primarily reflects expected sale of IMG Academy

Balance Sheet and Liquidity

At March 31, 2023, cash and cash equivalents totaled $718.7 million, compared to $767.8 million at December 31, 2022. Total debt was $5.151 billion at March 31, 2023, compared to $5.169 billion at December 31, 2022. Upon close of the sale of IMG Academy, Endeavor expects to commence repurchases of up to $300 million under an event-driven share repurchase authorization and pay down an additional $50 million of debt. Endeavor also expects to start making quarterly cash dividends of up to $25 million from Endeavor Operating Company to its common unit holders, including EGH, which, in turn, would dividend its portion each quarter to all holders of Endeavor’s Class A common stock. Endeavor expects to declare and pay the first dividend in the third quarter of 2023.

For further information regarding the Company’s financial results, as well as certain non-GAAP financial measures, and the reconciliations thereof, please refer to the following pages of this release or visit the Company’s Investor Relation site at investor.endeavorco.com.

Webcast Details
Endeavor will host an audio webcast to discuss its results and provide a business update at 2 p.m. PT / 5 p.m. ET today. The event can be accessed at: https://events.q4inc.com/attendee/338510069

The link to the webcast, as well as a recording, will also be available within the News/Events section of investor.endeavorco.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including the Company’s guidance for full year 2023, its expected long-term value and market position, contemplated debt repayment, repurchases under the share repurchase authorization and the commencement of declaring a quarterly cash dividend. The words “believe,” “may,” “will,” “estimate,” “potential,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” “target,” and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees and involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from what is expressed or implied by the forward-looking statements, including, but not limited to: changes in public and consumer tastes and preferences and industry trends; Endeavor’s ability to adapt to or manage new content distribution platforms or changes in consumer behavior; Endeavor’s dependence on the relationships of its management, agents, and other key personnel with clients; Endeavor’s dependence on key relationships with television and cable networks, satellite providers, digital streaming partners, corporate sponsors, and other distribution partners; risks related to Endeavor’s gaming business and applicable regulatory requirements; risks related to Endeavor’s organization and structure; and other important factors discussed in Part I, Item 1A “Risk Factors” in Endeavor’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as any such factors may be updated from time to time in the Company’s other filings with the SEC, including without limitation, the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023, accessible on the SEC’s website at www.sec.gov and Endeavor’s Investor Relations site at investor.endeavorco.com. Forward-looking statements speak only as of the date they are made and, except as may be required under applicable law, Endeavor undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

You can keep up with all your wrestling news right here on eWrestlingNews.com. Or, you can follow us over on our Twitter and Facebook pages.