Madison Square Garden Q1 Profit Up 16%, Results Beat View

(RTTNews) - Madison Square Garden Co. (MSG) on Friday reported a 16 percent increase in profit for the first quarter from last year, helped by affiliate rates and advertisement revenue at its media segment as well as higher suite rental fees and league distributions at its sports segment.

This was partly offset by lower revenues at the smaller entertainment segment due to lower event-related revenue at its venues. Both revenue and earnings per share for the quarter beat analysts' expectations.

Madison Square Garden operates in the sports, entertainment, and media businesses. The company owns the New York Knicks and New York Rangers, among other sports teams, and runs venues including Madison Square Garden and the Beacon Theatre.

The New York-based company's net income for the first quarter was $23.87 million or $0.31 per share, up from $20.61 million or $0.26 per share in the year-ago period. On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.22 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 6 percent to $215.59 million from $204.17 million in the year-ago period. Analysts had a consensus revenue estimate of $212.79 million for the quarter.

The increase in revenues were primarily due to higher revenues at the MSG Media and MSG Sports segments, partially offset by a decrease in revenues at the MSG Entertainment segment.

Revenue at MSG Media segment for the quarter increased 4 percent year-over-year to $166.62 million. Affiliation fee revenue increased $8.7 million, primarily due to higher affiliation rates and a favorable affiliate adjustment that is not expected to recur. Advertising revenue increased $2.5 million, reflecting higher advertising sales at Fuse and MSG Networks.

MSG Sports revenue grew 21 percent to $38.17 million, primarily due to higher suite rental fee revenue, league distributions and other net increases.

Meanwhile, MSG Entertainment revenues declined 7 percent to $28.63 million, primarily due to lower event-related revenues at Radio City Music Hall and the Beacon Theatre.

Madison Square noted that the fully transformed Madison Square Garden Arena debuted on October 25, 2013.

Hank Ratner, President and CEO of Madison Square Garden said, "With the completion of our third and final phase, our customers are now experiencing all of the amenities provided as a result of this unprecedented project, which was designed to benefit everyone who walks through our doors. A second important milestone is just around the corner, as we prepare for the January 2014 re-opening of the reinvented Forum in Inglewood, California."

Ratner added that with the successful completion of these projects, the company will be able to pursue additional opportunities to drive continued growth over the long-term.

In Friday's regular session, MSG is trading at $59.19, down $1.33 or 2.20 percent on a volume of 483,671 shares.