SFX reports increased losses amid impressive revenue growth
SFX Entertainment – which produces and promotes events like TomorrowWorld, Sensation, and Electric Zoo and has ownership in venues including LIV and Story – released its second quarter financial results yesterday. The young company reported a growth in revenue of 199%, to $82 million. The majority of the growth was due to acquisitions completed since the second quarter of 2013.
Despite its impressive revenue growth, SFX experienced a net loss increase of almost 78%, to $43.7 million. Net loss per share for the three month period was $0.50. However, these losses aren’t particularly alarming since SFX is a young, diversifying company.
The market reacted favorably to the revenue increase, sending SFX shares up 6.8%. While the stock price is still a good 42% below the initial public offering price, investors are looking excitedly towards the second half of the year; 50 of SFX’s 76 2014 festivals take place in the third and fourth quarters.
Robert F.X. Sillerman, Chairman and CEO of SFX, is confident in the company’s future:
“With the additional proof of concept of our ability to expand our existing powerful festival brands, with, for instance, Tomorrowland coming to Brazil and Rock in Rio coming to Las Vegas in 2015, we are now well-positioned to grow all aspects of our business. The EMC Revolution is just beginning. With an absolute dictum to keep our fans first, the next few periods should see significant impact from our investments in our core business, successful partnerships, and additional events.
“With inherent organic growth at our repeating festivals, the completion of major and meaningful marketing partnerships with quantifiable minimum values, and the significant investment in our platform and new festival locations now complete, the second quarter set the stage for near- and long-term growth, and equally importantly, a new generation of fan experiences. In short, this was an important, meaningful, and successful quarter.”