0000912057-01-536323.txt : 20011029 0000912057-01-536323.hdr.sgml : 20011029 ACCESSION NUMBER: 0000912057-01-536323 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20011023 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: FILED AS OF DATE: 20011023 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TICKETMASTER CENTRAL INDEX KEY: 0001006637 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 954546874 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-25041 FILM NUMBER: 1764394 BUSINESS ADDRESS: STREET 1: 3701 WILSHIRE BLVD STREET 2: STE 200 CITY: LOS ANGELES STATE: CA ZIP: 90010 BUSINESS PHONE: 6264050050 MAIL ADDRESS: STREET 1: 3701 WILSHIRE BLVD CITY: LOS ANGELES STATE: CA ZIP: 90010 FORMER COMPANY: FORMER CONFORMED NAME: CITYSEARCH INC DATE OF NAME CHANGE: 19980617 FORMER COMPANY: FORMER CONFORMED NAME: PERFECTMARKET INC DATE OF NAME CHANGE: 19960909 FORMER COMPANY: FORMER CONFORMED NAME: TICKETMASTER ONLINE CITYSEARCH INC DATE OF NAME CHANGE: 19980923 8-K 1 a2061673z8-k.htm 8-K Prepared by MERRILL CORPORATION
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 23, 2001

Ticketmaster
(Exact name of registrant as specified in its charter)

Delaware
(State or Other Jurisdiction
of Incorporation)		   0-25041
(Commission File Number)		   95-4546874
(IRS Employer
Identification No.)

3701 Wilshire Blvd., Los Angeles, California
(Address of principal executive offices)
 
90010
(Zip Code)

Registrant's telephone number, including area code: (213) 381-2000


Item 5.  Other Events.

    On October 23, 2001, the Registrant issued a press release announcing its results for the quarter ended September 30, 2001. The full text of the press release, which is set forth in Exhibit 99.1 hereto, is filed and incorporated in this Report as if fully set forth herein, except for the following: (a) the second sentence of the paragraph immediately following the table (including the footnotes thereto) under the heading "Financial Results"; (b) the second, third and fourth sentences in the second paragraph, the second sentence in the fifth paragraph, the sixth paragraph, and the second and third sentences in the eighth paragraph under the heading "Ticketing Operations"; (c) the second and third sentences of the third paragraph under the heading "City Guide"; and (d) the second and fourth sentences of the second paragraph under the heading "Personals (Match)".


Item 7.  Financial Statements and Exhibits.

(c)
Exhibits.
Exhibit No.
   Description
99.1   Press Release dated October 23, 2001.

99.2
 
Guidance Information


Item 9.  Regulation FD Disclosure

    The following are not filed but are furnished pursuant to Regulation FD: (a) the following portions of the text of the press release, appearing in Exhibit 99.1 hereto: (i) the second sentence of the paragraph immediately following the table (including the footnotes thereto) under the heading "Financial Results"; (ii) the second, third and fourth sentences in the second paragraph, the second sentence in the fifth paragraph, the sixth paragraph, and the second and third sentences in the eighth paragraph under the heading "Ticketing Operations"; (iii) the second and third sentences of the third paragraph under the heading "City Guide"; and (iv) the second and fourth sentences of the second paragraph under the heading "Personals (Match)"; and (b) the guidance information appearing as Exhibit 99.2 hereto.

2


SIGNATURES

    Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 23, 2001   TICKETMASTER

 
 
By:
 
/s/ JOHN PLEASANTS   
John Pleasants
 Chief Executive Officer

3


INDEX TO EXHIBITS

Exhibit No.
   Description
99.1   Press Release dated October 23, 2001.

99.2
 
Guidance Information

4



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SIGNATURES
INDEX TO EXHIBITS
 EX-99.1 3 a2061673zex-99_1.htm EXHIBIT 99.1 Prepared by MERRILL CORPORATION
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TICKETMASTER

Ticketmaster Reports Third Quarter Year Over Year
Revenue and EBITDA Gains

Match Contributes $5.8 million of EBITDA,
A 156 Percent Increase Over Prior Year Period

Citysearch launches its new "Anything/Anywhere" Search Product

    Los Angeles, CA—October 23, 2001—Ticketmaster (NASDAQ: TMCS) today released quarterly and nine-month results for the period ended September 30, 2001.

    Revenues in the third quarter of 2001 increased 7.1 percent over the comparable year-ago period to $157.5 million. EBITDA* in the third quarter of 2001 was $14.0 million, compared to EBITDA* of $2.7 million in the year ago quarter, an improvement of 426.4 percent. Cash EPS** was $0.04 per share compared with $(0.03) per share in the year ago quarter. First Call consensus for Cash EPS for the third quarter of 2001 was $0.02 per share.

    For the nine-month period ended September 30, 2001, total company revenues were $515.6 million, compared to $462.3 million in the year ago period, an increase of 11.5 percent. EBITDA for the nine-month period was $60.1 million in 2001, compared to $24.7 million in 2000, an increase of 142.9 percent over the prior year period. Prior period comparisons are based on pro forma results for the prior periods assuming that the combination with Ticketmaster Corporation occurred on January 1, 2000. For a complete presentation of the results, please see the financial tables attached to this press release.

(*EBITDA—earnings before interest, taxes, depreciation, amortization, merger and other non-recurring charges, minority interest, advertising provided by USA Networks, Inc. for which no consideration was paid by the Company, non-cash compensation, equity income/loss of unconsolidated affiliates, investment losses, net and other income and expenses. **Cash EPS—basic earnings per share excluding amortization, merger and other non-recurring charges, equity in income/loss of unconsolidated affiliates, advertising provided by USA Networks, Inc. for which no consideration was paid by the Company, non-cash compensation and investment losses, net).

1

Financial Results

 
   Three Months Ended September 30,
   Nine Months Ended September 30,
  
$ in thousands
  
  2001(b)
   2000(a)
   Change
   2001(b)
   2000(a)
   Change
  
Revenues                                  
  Ticketing operations   $ 133,897   $ 124,928   7.2 % $ 447,903   $ 395,909   13.1 %
  City guide     11,078     13,991   (20.8 )%   35,851     36,827   (2.7 )%
  Personals     12,478     7,571   64.8 %   31,687     21,949   44.4 %
  Other     0     592   NM     149     7,639   NM  
   
 
 
 
 
 
 
Total Revenue   $ 157,453   $ 147,082   7.1 % $ 515,590   $ 462,324   11.5 %
   
 
 
 
 
 
 
 
   Three Months Ended September 30,
   Nine Months Ended September 30,
  

$ in thousands
 
  2001(b)
   2000(a)
   Change
   2001(b)
   2000(a)
   Change
  
EBITDA                                  
  Ticketing operations   $ 19,021   $ 16,656   14.2 % $ 84,775   $ 75,607   12.1 %
  City guide     (8,412 )   (13,401 ) 37.2 %   (25,700 )   (42,662 ) 39.8 %
  Personals     5,801     2,264   156.2 %   8,908     4,827   84.5 %
  Corporate and other     (2,382 )   (2,854 ) 16.5 %   (7,887 )   (13,027 ) 39.5 %
   
 
 
 
 
 
 
Total EBITDA   $ 14,028   $ 2,665   426.4 % $ 60,096   $ 24,745   142.9 %
   
 
 
 
 
 
 
(a)
The unaudited financial information for 2000 gives effect to the combination with Ticketmaster Corporation as if the combination had occurred at the beginning of the year. The unaudited results of operations are based on accounting for the combination at historical cost in a manner similar to that in pooling-of-interests accounting.

(b)
Ticketing operations in each of the three and nine months ended September 30, 2001 does not include $4.2 million of revenue and $0.4 million of EBITDA, as during the third quarter the Company altered the method (from consolidation to the equity method) by which it accounted for its 50.01% stake in Ticketmaster 7, its Australian-based joint venture. In addition, the change in accounting treatment resulted in the number of consolidated tickets reported sold for the third quarter of 2001 to be reduced by 1.2 million.

    "We are pleased to be able to deliver total company results in line with expectations, despite the negative impact the tragic events of September 11 had on our ticketing business," said John Pleasants, president and chief executive officer. "While current economic conditions are uncertain, our businesses support and enable people to go out and do the things they want to do—areas in which we have long term confidence."

Third Quarter Highlights Include:

    •
    Ticketmaster doubled the rate of user registrations on ticketmaster.com

    •
    The Citysearch network topped 100 million monthly pageviews in July and August

    •
    Citysearch's "Best Of" feature logged more than three million votes as users helped define the best of their city

    •
    Citysearch launched its new "Anything/Anywhere" search product, greatly expanding its local content and utility

    •
    Match ended the quarter with total paid subscriptions exceeding 250,000

    •
    Match introduced its new broadcast media campaign, increasing awareness of the brand and the category

    •
    ReserveAmerica increased its inventory, adding Idaho and Florida State Parks

    •
    The integration of the Company's ticketing and dating services into America Online is now largely complete and the integration of America Online's movie ticketing into Citysearch has been completed

2

Ticketing Operations

    Third quarter revenues from Ticketing operations were $133.9 million, compared with $124.9 million in the year ago quarter, an increase of 7.2 percent. The revenue increase reflects a 9.3 percent increase in revenue per ticket (from $5.67 to $6.20), the acquisition of ReserveAmerica in February 2001 and revenue growth in the United Kingdom and Ireland and was partially offset by the impact of events surrounding September 11. Tickets sold decreased from 20.2 million in the third quarter of 2000 to 19.3 million in the third quarter of 2001. Excluding tickets sold by the Company's Australian joint venture (which was included in the year ago period), tickets sold increased 0.5 percent. Gross transaction value for the third quarter of 2001 was $787.6 million.

    During the quarter the Company continued to invest in expanding and improving its infrastructure to support clients and consumers. "System upgrades for our outlet partners, increasing use of IVR at our phone centers, innovative fan loyalty programs and new systems to support season ticket sales are all part of our commitment to help clients sell more tickets," said Pleasants. "In particular, we are pleased with our ticketfast™ technology, formerly Print-My-Own, which is demonstrating high consumer adoption rates. We are now active in 32 major venues and we expect to have 60 completed by year end."

    EBITDA from Ticketing operations in the third quarter of 2001 was $19.0 million compared with $16.7 million, an increase of 14.2 percent. Ticketing EBITDA in the third quarter of 2000 included approximately $4.9 million of expenses relating to litigation settlements. EBITDA in the third quarter of 2001 was adversely impacted relative to expectations primarily due to reduced ticket sales, event postponements and event cancellations following September 11.

    Online ticketing revenue was $44.6 million, compared to $35.5 million a year ago, an increase of 25.6 percent. The percentage of tickets sold online was 31.9 percent compared with 25.6 percent in the third quarter of 2000. Gross transaction value in the third quarter for online ticket sales was $284.4 million compared to $224.8 million in the year ago quarter.

    "As part of our commitment to increase online penetration, we improved our ticketing web site during the quarter by increasing functionality and adding a new 'browse' feature, all of which resulted in doubling the rate of user registrations. We believe we can further accelerate this migration of ticket sales by working with clients to develop marketing programs built around the Internet and by continuing to improve the technology of this highly efficient distribution method," said Pleasants.

    During the quarter, the Company piloted several new access and notification programs. "Early efforts with individual targeted email alerts, client coordinated pre-sales and new CRM programs have reinforced our commitment to these initiatives," said Pleasants.

    The Company continued to improve its advertising and direct marketing revenue, capitalizing on the Company's relationship with millions of purchasing consumers. In the third quarter 2001, revenue from such sources incremental to traditional ticketing revenue such as advertising and direct marketing equaled $0.28 per ticket sold compared to $0.27 in the third quarter of 2000.

    "We are encouraged by daily ticketing volumes as they are generally in line with year ago levels. However, given the current environment, we are cautious in our near term outlook, including for the fourth quarter, where we do not expect to see as much ticketing purchase activity in the holiday season as we would have expected before September 11 and we expect to see some decline in our advertising revenue and software related businesses," said Pleasants. "Notwithstanding the current uncertainty, our strategy remains to grow our ticketing business by increasing volume, as well as provide clients with new products and programs to stimulate incremental demand and provide more ticketing services to clients."

3

City Guide

    Revenue from City guide was $11.1 million in the third quarter of 2001, a 20.8 percent decrease from $14.0 million in the comparable year-ago period. EBITDA from City guide in the third quarter was a loss of $8.4 million compared with a loss of $13.4 million a year ago, a 37.2 percent improvement, reflecting Citysearch's initiatives to reduce operating costs. In the third quarter, the Citysearch network (Citysearch, Evite and LiveDaily), increased pageviews to 256.4 million for the quarter, an 81.1 percent increase over the year ago quarter, and unique users increased to a monthly average of 5.2 million.

    In the third quarter, Citysearch launched its "Anything/Anywhere" search product. This new feature expands Citysearch's offering beyond arts and entertainment, making it a comprehensive source for local information. Anything/Anywhere has broadened Citysearch's reach with approximately 10 percent of searches occurring in areas outside Citysearch's previously defined focus areas.

    "Citysearch continues to deliver significant increases in pageviews and unique users, confirming the attractiveness and growing appeal of the site," said Pleasants. "The advertising market remains difficult, but we remain confident in Citysearch's ability to innovate and respond to client needs. New features, such as our 'Anything/Anywhere' local search product, as well as new advertising and direct marketing should help position the Company to capitalize longer term on the large local advertising market."

Personals (Match)

    Third quarter revenue from the personals business was $12.5 million compared with $7.6 million in the year ago period, an increase of 64.8 percent from the year ago quarter. EBITDA in the third quarter increased to $5.8 million, from $2.3 million a year ago, an increase of 156.2 percent.

    "We are thrilled with the traction and momentum that Match displayed in the third quarter. We believe we've entered a new period in this company's growth, in which Match's brand, distribution strength, and network scale are coming together to transform the very concept of online dating," said Pleasants. "In the third quarter, Match benefited from its expanding relationships with America Online and MSN, a new broadcast media campaign, new site features, and an increasingly sophisticated CRM notification effort. With approximately half of the adult population over 18 single, we think that Match can extend its category leadership and can deliver strong top and bottom line growth."

    The Company's personals operations attracted a monthly average of 2.4 million unique users in the third quarter of 2001, a 41.2 percent increase over the year ago period. At end of the third quarter of 2001, the personals operations had 252,700 paying subscription members compared to 156,945 at year-end 2000, an increase of 61.0 percent year to date.

Corporate and Other

    In the third quarter of 2001, Corporate and other reported no revenue due to the transfer of the Company's electronic commerce service operation (in the third quarter of 2000) and TM Realty operation (in connection with the combination of Ticketmaster Corporation and Ticketmaster Online-Citysearch) to USA Networks, Inc. The EBITDA loss from Corporate and other improved from a loss of $2.9 million in the third quarter of 2000 to a loss of $2.4 million in the third quarter of 2001, largely reflecting these same transfers.

Other Items

    During the quarter the Company wrote down the assets of its equity holdings in certain Internet ventures, resulting in a charge of $6.7 million. The Company also incurred approximately $1.0 million of restructuring charges associated with previously announced Citysearch initiatives.

4

Audience and Traffic Highlights

    Total online network traffic grew significantly during the quarter to an estimated 1.4 billion page views during the quarter, an increase of 100 percent from the year ago quarter. In September, according to Jupiter Media Metrix, Ticketmaster's combined reach among home and work users was 11.4 percent and unique users was 11.3 million, an increase in unique users of 44.9 percent from the year ago comparable period.

Ticketmaster Advertising on USA Networks

    During the quarter USA Networks provided advertising and promotional support to Ticketmaster as well as to certain partners of the Company in connection with strategic relationships. The Company recorded a non-cash charge of approximately $3.5 million in the third quarter of 2001 related to such support.

Conference Call

    The Company will host a conference call to discuss its third quarter results which is open to all parties. The call will be held on Tuesday, October 23, 2001 at 4:30 p.m. Eastern Time. Those parties in the United States and Canada interested in participating in the telephone conference should call (312) 470-0017 (toll call) and use pass code Ticketmaster or listen on the Web at www.abouttmcs.com.

    Replays of the conference call will begin approximately one hour after its completion and will run until 8:00 p.m. Eastern Time on October 30, 2001. To hear the replay, parties in the United States and Canada should call (402) 998-1815 (toll call). An online replay of the conference call will be available at www.abouttmcs.com.

About Ticketmaster

    Ticketmaster (NASDAQ: TMCS), the world's leading ticketing and access company, sold 83 million tickets in 2000 valued at more than 3.2 billion dollars, through approximately 3,800 retail Ticket Center outlets; 20 worldwide telephone call centers; and ticketmaster.com. Ticketmaster serves more than 6,200 clients worldwide and acts as the exclusive ticketing service for hundreds of leading arenas, stadiums, performing arts venues, and theaters. The Company also operates Citysearch, a leading online local network enabling people to get the most out of their city and Match.com, the premier online matchmaking service. Located in Los Angeles, California, Ticketmaster is majority owned by USA Networks, Inc. (NASDAQ: USAI) and is a part of its Interactive Group. Ticketmaster was formed through the combination of the operations of Ticketmaster Online-Citysearch and Ticketmaster Corporation in January 2001 and renamed Ticketmaster.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

    This press release contains forward-looking statements about Ticketmaster (the "Company"), including statements concerning its future product plans. These forward-looking statements involve risks and uncertainties. The Company's actual results could differ materially from these statements. These forward-looking statements are based on the Company's expectations as of the date of this release and the Company undertakes no obligation to update these statements. Among the risks and uncertainties that could adversely affect the Company's actual results are: that the Company may not realize the synergies and other intended benefits of the combination of Ticketmaster and Ticketmaster Online-Citysearch; that the Company may have difficulty overcoming problems associated with rapid expansion and growth; the dependence of the Company's business on entertainment, sporting and leisure events; quarterly fluctuations in the Company's revenues which could adversely affect the market price of the Company's stock; the risks of operating internationally; the dependence of the Company on its relationships with clients; the Company's future capital needs and the uncertainty of additional

5

financing; the Company's dependence on key personnel and need to hire additional qualified personnel; control of the Company by USA Networks, Inc.; the potential for conflicts of interest between the Company and USA Networks, Inc.; the Company's need to continue to promote its brands; risks associated with competition; the Company's reliance on third party technology; network security risks; the Company's need to be able to adapt to rapid technological changes; liability associated with the information displayed or accessed on the Company's web sites; intellectual property infringement risks; risks associated with changing legal requirements on the Company's operations, including privacy concerns; litigation risks; the dilutive effect of future acquisitions; risks associated with the failure to maintain the Company's domain names; the risk to its stock price associated with the Company's anti-takeover provisions; and the risk associated with ongoing litigation and governmental investigations relating to the Company's business practices. Investors are encouraged to read the risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission.

    Ticketmaster is the owner or licensee of its name and logo trademarks and service marks. All other trademarks and trade names are the property of their respective owners.

6


TICKETMASTER
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share information)

 
   September 30, 2001
   December 31, 2000
  
 
   (unaudited)

   (a)

  
ASSETS              
Current assets:              
  Cash and cash equivalents   $ 117,910   $ 120,809  
  Marketable securities     6,063     7,938  
  Accounts receivable, ticket sales     48,044     32,395  
  Accounts receivable, trade     31,707     29,710  
  Contract advances     10,848     10,551  
  Prepaid expenses and other current assets     13,430     14,905  
   
 
 
    Total current assets     228,002     216,308  
Property, equipment and leasehold improvements, net     71,753     88,386  
Goodwill and other intangibles, net     1,073,233     1,185,948  
Other assets     66,188     52,301  
Deferred income taxes, net     3,796     3,391  
   
 
 
    Total assets   $ 1,442,972   $ 1,546,334  
   
 
 

LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
 
 
 
 
Current liabilities:              
  Current portion of long-term debt   $ 695   $ 4,778  
  Accounts payable, trade     8,813     10,652  
  Accounts payable, clients     118,095     97,687  
  Accrued expenses     60,289     67,618  
  Due to USAi and affiliates     3,203     —  
  Deferred revenue and other     19,509     14,764  
   
 
 
    Total current liabilities     210,604     195,499  
Long-term debt, net of current portion     1,089     13,092  
Due to USAi and affiliates     —     181,411  
Other long-term liabilities     23,497     9,347  
Minority interest     827     4,631  
Stockholders' equity:              
  Common stock     1,416     1,410  
  Additional paid-in capital     1,699,198     1,516,484  
  Accumulated deficit     (490,443 )   (371,922 )
  Accumulated other comprehensive loss     (3,216 )   (3,618 )
   
 
 
    Total stockholders' equity     1,206,955     1,142,354  
   
 
 
      Total liabilities and stockholders' equity   $ 1,442,972   $ 1,546,334  
   
 
 

7


TICKETMASTER
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share information)

 
   Three Months Ended September 30,
   Nine Months Ended September 30,
  
 
   2001
   2000
   2001
   2000
  
 
   (unaudited)

  
Revenues:                          
  Ticketing operations   $ 133,897   $ 124,928   $ 447,903   $ 395,909  
  City guide     11,078     13,991     35,851     36,827  
  Personals     12,478     7,571     31,687     21,949  
  Other     —     592     149     7,639  
   
 
 
 
 
    Total revenues     157,453     147,082     515,590     462,324  
   
 
 
 
 
Operating costs and other expenses:                          
  Ticketing operations     88,970     81,967     287,320     253,436  
  City guide operations     9,912     11,296     31,205     33,956  
  Personals operations     3,756     1,897     9,581     6,549  
  Other     —     607     142     11,614  
  Sales and marketing     19,057     23,243     64,117     63,355  
  General and administrative     25,581     27,207     77,600     71,306  
  Depreciation and amortization     51,174     51,603     153,901     150,600  
  Merger and other non-recurring charges     976     —     976     —  
   
 
 
 
 
    Total operating costs and other expenses     199,426     197,820     624,842     590,816  
   
 
 
 
 
Loss from operations     (41,973 )   (50,738 )   (109,252 )   (128,492 )
   
 
 
 
 
Other (income) expenses:                          
  Interest income     (417 )   (904 )   (1,719 )   (3,081 )
  Interest expense     53     2,250     2,485     6,168  
  Equity in net (income) loss of unconsolidated affiliates     257     644     (684 )   2,636  
  Investment losses, net     6,679     —     6,679     —  
   
 
 
 
 
    Total other expenses     6,572     1,990     6,761     5,723  
   
 
 
 
 
Loss before income taxes and minority interest     (48,545 )   (52,728 )   (116,013 )   (134,215 )
Minority interest in income (loss)     141     (220 )   (1,419 )   (786 )
Income tax provision (benefit)     721     (1,264 )   3,927     11,734  
   
 
 
 
 
Net loss   $ (49,407 ) $ (51,244 ) $ (118,521 ) $ (145,163 )
   
 
 
 
 
Basic and diluted net loss per share   $ (0.35 ) $ (0.36 ) $ (0.84 ) $ (1.05 )
   
 
 
 
 
Shares used to compute basic and diluted net loss per share     141,568     140,548     141,332     138,909  
   
 
 
 
 

Supplemental Financial Information(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
EBITDA(c)   $ 14,028   $ 2,665   $ 60,096   $ 24,745  
   
 
 
 
 
Cash EPS(d)   $ 0.04   $ (0.03 ) $ 0.24   $ (0.08 )
   
 
 
 
 
Advertising provided by USA Networks, Inc. for which no cash was paid by Ticketmaster   $ 3,508   $ 1,457   $ 13,441   $ 1,607  
   
 
 
 
 
Non-cash compensation   $ 343   $ 343   $ 1,030   $ 1,030  
   
 
 
 
 
Amortization   $ 43,314   $ 44,490   $ 130,710   $ 129,056  
   
 
 
 
 

8

Notes:

(a)
The December 31, 2000 balance sheet represents the combination of Ticketmaster Online-Citysearch and Ticketmaster Corporation. This combination was accounted for as an exchange of assets between entities under common control in a manner similar to the pooling of interests method of accounting.

(b)
The accompanying supplemental financial information is presented for informational purposes only and should not be considered as a substitute for the historical financial information presented in accordance with generally accepted accounting principles.

(c)
EBITDA is defined as earnings before interest, taxes, depreciation, amortization, minority interest, merger and other non-recurring charges, advertising provided by USA Networks, Inc. for which no consideration was paid by Ticketmaster, non-cash compensation, equity in income/loss of unconsolidated affiliates, investments losses, net and other income/expense.

(d)
Cash EPS is defined as basic earnings per share excluding amortization, merger and other non-recurring charges, advertising provided by USA Networks, Inc. for which no consideration was paid by Ticketmaster, non-cash compensation, equity in income/loss of unconsolidated affiliates and investment losses, net.

9



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Ticketmaster Reports Third Quarter Year Over Year Revenue and EBITDA Gains
CONDENSED CONSOLIDATED BALANCE SHEETS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 EX-99.2 4 a2061673zex-99_2.htm EXHIBIT 99.2 Prepared by MERRILL CORPORATION

As furnished to the Securities and Exchange Commission on October 23, 2001

Ticketmaster

($ millions, except per share data)

 
    
    
    
    
    
    
   Actual
   Guidance Estimates
  
 
    
   2000 Pro Forma Actual
   2001
    
    
  
 
   Pro Forma Actual 1999
    
    
  
 
   Q1
   Q2
   Q3
   Q4
   Year
   Q1
   Q2
   Q3
   Q4
   Year
   2002
   2003
  
REVENUES                                                                                
  Ticketing operations(a)   $ 442.7   $ 128.0   $ 143.0   $ 124.9   $ 122.7   $ 518.6   $ 150.1   $ 163.9   $ 133.9   $ 125.0   $ 572.9   $ 620.0   $ 680.0  
  City guide(b)     27.3     10.1     12.8     14.0     14.1     50.9     12.4     12.4     11.1     11.0     46.9     50.0     70.0  
  Personals(c)     9.0     6.9     7.5     7.6     7.2     29.1     8.5     10.7     12.5     13.5     45.2     60.0     80.0  
  Corporate and other(d)     19.5     4.3     2.8     0.6     0.5     8.1     0.1     —     —     —     0.1     —     —  
   
 
 
 
 
 
 
 
 
 
 
 
 
 
    Total Revenue   $ 498.5   $ 149.2   $ 166.0   $ 147.1   $ 144.4   $ 606.7   $ 171.2   $ 187.0   $ 157.5   $ 149.5   $ 665.1   $ 730.0   $ 830.0  
   
 
 
 
 
 
 
 
 
 
 
 
 
 
EBITDA(e)                                                                                
  Ticketing operations(a)   $ 95.9   $ 27.4   $ 31.6   $ 16.7   $ 24.4   $ 100.0   $ 30.2   $ 35.5   $ 19.0   $ 20.0   $ 104.8   $ 125.0   $ 145.0  
  City guide(b)     (51.7 )   (15.5 )   (13.7 )   (13.4 )   (10.8 )   (53.4 )   (9.0 )   (8.3 )   (8.4 )   (8.3 )   (34.0 )   (17.5 )   —  
  Personals(c)     (0.4 )   0.9     1.7     2.3     1.4     6.2     0.3     2.8     5.8     5.5     14.4     20.0     30.0  
  Corporate and other(d)     (2.9 )   (4.4 )   (5.8 )   (2.9 )   (1.5 )   (14.5 )   (2.8 )   (2.8 )   (2.4 )   (3.0 )   (11.0 )   (12.5 )   (12.5 )
   
 
 
 
 
 
 
 
 
 
 
 
 
 
      Total EBITDA     40.9     8.3     13.7     2.7     13.5     38.3     18.7     27.3     14.0     14.2     74.2     115.0     162.5  

Depreciation
 
 
(19.3
)
 
(6.1
)
 
(8.3
)
 
(7.1
)
 
(10.0
)
 
(31.5
)
 
(7.5
)
 
(7.8
)
 
(7.9
)
 
(8.5
)
 
(31.7
)
 
(34.0
)
 
(34.0
)
Goodwill and other amortization(f)     (108.6 )   (41.7 )   (42.9 )   (44.5 )   (63.3 )   (192.4 )   (43.6 )   (43.8 )   (43.3 )   (45.0 )   (175.7 )   (180.0 )   (180.0 )
Advertising provided by USA Networks, Inc.     (0.2 )   (0.2 )   —     (1.5 )   (5.6 )   (7.3 )   (4.1 )   (5.8 )   (3.5 )   —     (13.4 )   —     —  
Non-cash compensation     —     (0.3 )   (0.3 )   (0.3 )   (0.3 )   (1.4 )   (0.3 )   (0.3 )   (0.3 )   (0.4 )   (1.4 )   (4.0 )   (4.0 )
Merger and other non-recurring charges     (4.2 )   —     —     —     (4.1 )   (4.1 )   —     —     (1.0 )   —     (1.0 )   —     —  
Interest income/(expense)     (2.5 )   (0.6 )   (1.1 )   (1.3 )   (1.9 )   (5.0 )   (1.1 )   —     0.4     0.4     (0.3 )   —     —  
Equity in net income (loss) of unconsol. affil.     1.2     (1.9 )   (0.1 )   (0.6 )   0.5     (2.2 )   0.5     0.4     (0.3 )   —     0.6     —     —  
Investment losses, net     —     —     —     —     (8.8 )   (8.8 )   —     —     (6.7 )   —     (6.7 )   —     —  
Other income/(expenses)     —     —     —     —     (2.2 )   (2.2 )   —     —     —     —     —     —     —  
   
 
 
 
 
 
 
 
 
 
 
 
 
 
  Income before taxes and minority interest     (92.7 )   (42.4 )   (39.0 )   (52.7 )   (82.3 )   (216.5 )   (37.3 )   (30.1 )   (48.5 )   (39.3 )   (155.3 )   (103.0 )   (55.5 )
Minority interest     1.4     0.4     0.2     0.2     0.4     1.2     0.6     1.0     (0.1 )   —     1.5     —     —  
   
 
 
 
 
 
 
 
 
 
 
 
 
 
  Pre-tax income/(loss)     (91.3 )   (42.0 )   (38.8 )   (52.5 )   (81.9 )   (215.3 )   (36.7 )   (29.1 )   (48.7 )   (39.3 )   (153.9 )   (103.0 )   (55.5 )
Income tax provision     (24.0 )   (6.1 )   (6.9 )   1.3     (3.0 )   (14.7 )   (2.8 )   (0.4 )   (0.7 )   (0.9 )   (4.9 )   (12.0 )   (15.0 )
   
 
 
 
 
 
 
 
 
 
 
 
 
 
  Net income/(loss)   $ (115.3 ) $ (48.1 ) $ (45.8 ) $ (51.2 ) $ (84.9 ) $ (230.0 ) $ (39.6 ) $ (29.5 ) $ (49.4 ) $ (40.2 ) $ (158.8 ) $ (115.0 ) $ (70.5 )
   
 
 
 
 
 
 
 
 
 
 
 
 
 

Weighted average shares outstanding(g)
 
 
128.1
 
 
137.4
 
 
138.8
 
 
140.5
 
 
140.8
 
 
139.4
 
 
141.1
 
 
141.3
 
 
141.6
 
 
142.7
 
 
142.0
 
 
142.5
 
 
142.5
 
Earnings per share   $ (0.90 ) $ (0.35 ) $ (0.33 ) $ (0.36 ) $ (0.60 ) $ (1.65 ) $ (0.28 ) $ (0.21 ) $ (0.35 ) $ (0.28 ) $ (1.12 ) $ (0.81 ) $ (0.49 )

Cash earnings per share(h)
 
$
(0.03
)
$
(0.03
)
$
(0.02
)
$
(0.03
)
$
(0.02
)
$
(0.10
)
$
0.06
 
$
0.14
 
$
0.04
 
$
0.04
 
$
0.27
 
$
0.48
 
$
0.80
 

Note: Due to rounding of individual line items, numbers may not add.

(a)
Ticketing operations includes all of the Company's ticketing and reserved access operations and includes all direct overhead costs related to the ticketing and reserved access operations and is consistent with the previous presentation as reflected in USA Networks, Inc. financials.

(b)
City guide includes all direct overhead costs related to the city guide operations.

(c)
Personals includes all direct overhead costs related to the personals operations.

(d)
Corporate and other includes for the periods 1999 and 2000 the Company's Electronic Commerce Service and TM Realty operations, which have subsequently been transferred to USA Networks, Inc. For all periods this line includes the corporate expenses related to our operation as a public company and its growth initiatives.

(e)
EBITDA is defined as earnings before interest, taxes, depreciation, amortization, merger and other non-recurring charges, minority interest, advertising provided by USA Networks, Inc. for which no consideration was paid by the Company, non-cash compensation, equity in net income (loss) of unconsolidated affiliates, investment losses, net and other income and expenses. The presentation of segment EBITDA reflects the allocation of direct overhead costs to the Ticketing operations, City guide and Personals segments and captures in Corporate and other those corporate expenses related to our operation as a public company and its growth initiatives. For the year 2000 and the first quarter 2001, the above amount may differ from the amount previously reported or furnished since commencing in the second quarter of 2001 the Company excluded non-cash compensation from its calculation of EBITDA and has adjusted the prior amounts for comparability purposes.
(f)
This line reflects the amortization of goodwill and other intangible assets over their respective estimated lives. In June 2001, the Financial Accounting Standards Board issued Statements of Financial Accounting Standards No. 141, "Business Combinations," and No. 142, "Goodwill and Other Intangible Assets," effective for fiscal years beginning after December 15, 2001. The Company will apply the new rules on accounting for goodwill and other intangible assets beginning in the first quarter of 2002. During or by 2002, the Company will perform the first of the required impairment tests of goodwill and indefinite lived intangible assets as of January 1, 2002 and has not yet determined what the effect of these tests will be on the results of operations and financial position of the Company.

(g)
The Company's historical weighted average shares outstanding for the periods 1999 and 2000 were adjusted to reflect the 52 million shares issued to USA Networks, Inc. in the combination as if issued at the beginning of the period.

(h)
Cash EPS is defined as basic earnings per share excluding amortization, merger and other non-recurring charges, advertising provided by USA Networks, Inc. for which no consideration was paid by the Company, non-cash compensation, equity in net income (loss) of unconsolidated affiliates and investment losses, net. For the year 2000 and the first quarter 2001, the above amount may differ from the amount previously reported or furnished since commencing in the second quarter of 2001 the Company excluded non-cash compensation from its calculation of Cash EPS and has adjusted the prior amounts for comparability purposes.

Important:

    The methodology used in the preparation of the pro forma actual information above is disclosed in the Company's definitive Information Statement filed with the SEC on January 11, 2001. Refer to the Information Statement for a description of that methodology. The Company's guidance estimates above are based on the Company's expectations as of the date of this filing and the Company undertakes no obligation to update these estimates. These forward-looking estimates involve risks and uncertainties. The Company's actual results could differ materially from these estimates. These statements do not include the potential impact of any mergers, acquisitions or other business combinations that may be completed after October 23, 2001.