NEW YORK (CelebrityAccess) — SFX Entertainment (SFXE) missed Wall Street's expectations when they announced their earnings results for the third quarter, this week reporting revenue of $133.23 million, down 7% from the same period in 2014.
The company said that the drag on their revenue was largely from foreign currency exchange and if that was exc;ided, revenue in the three months ended September 30, 2015 would have declined by $0.5 million, or less than 1%, year over year. The company also cited several events that had been canceled, or partially canceled, adversely impacting revenue to the tune of $4 million.
Operating losses for the quarter were up sharply, with the company reporting 41.5 million in losses compared to 20.8 million in 2014. SFXE also managed to turn their net income from black to red, with a loss of 54.2 million for the quarter against a profit of 5 million in 2014.
During the three months ended September 30, 2015, SFX reported holding a total of 286 festivals and events. Total attendance at festivals and events during the three months ended September 30, 2015 grew 24.8% year over year to 1,946,000 attendees, while attendance during the nine months ended September 30, 2015 rose 36.8% over the prior year period to 4,082,000 attendees.
“Despite continued strong gains in total attendance, the third quarter of 2015 was challenging for SFX in several respects, including the impact of foreign exchange and the cancellation of several festival days to weather,” said Robert F.X. Sillerman, Chairman and CEO of SFX. “Additionally, the Company’s sales and recognition of revenue from sponsorships did not meet our expectations, which we consider primarily a timing issue. However, we remain very pleased with the quality and loyalty of our sponsors and marketing partners, as reflected by their willingness to renew, and in some cases expand, their partnerships, and we are confident in our potential to secure additional sponsorships."
"While our financial performance was impacted by external factors, we are making several significant changes this quarter to address the lower than anticipated operating results. Additionally, although fourth quarter results are expected to benefit from insurance settlements and the finalization of a new marketing agreement, the 2015 full year financial results will not meet our prior expectations. Going forward, and notwithstanding the ongoing sales process, our teams remain focused on operations,” Sillerman added. – Staff Writers