Second Quarter 2019
Highlights
- Revenues were $268.9 million as compared to $281.6 million in
the prior year quarter
- Operating income was $17.1 million; Adjusted OIBDA1 was $34.6
million, which exceeded the Company’s guidance
- Announced content distribution deals with BT Sport in the U.K.,
Fox Sports in Latin America and PP Sports in China, providing
strong platforms for reaching WWE audiences
- WWE Network average paid subscribers2 were 1.69 million paid
subscribers, consistent with the Company’s guidance
- Digital video views increased 17% to 9.0 billion; hours
consumed increased 22% to 324 million hours across digital
platforms; and social media followers increased 10% to over 1.02
billion3
WWE Network
- The Company initiated the transition of WWE Network to a new
platform on July 24, which will provide users with a better
experience, a more intuitive interface, and enhanced search
functionality
- The new platform enables the introduction of new features and
experiences over time, including the addition of free and premium
tiers as well as the localization of content in multiple
languages
- Produced more than 90 hours of original network content,
including live in-ring programs and talent documentaries, such as
The Shield’s Final Chapter and WWE 24: The Year of Ronda Rousey,
respectively
WWE (NYSE: WWE) today announced financial results for its second
quarter ended June 30, 2019.
“During the quarter, we made progress on key strategic
initiatives,” stated Vince McMahon, Chairman and Chief Executive
Officer. “We completed content distribution agreements in key
international markets, prepared for the next phase of our WWE
Network service, and achieved steady improvement in engagement
metrics. As indicated previously, we remain excited about the
future, particularly with our debut on Fox in October.”
George Barrios, Co-President, added “In the quarter, our
earnings exceeded guidance, however we anticipate a portion of this
to reverse and we continue to target full-year Adjusted OIBDA of at
least $200 million. The guidance presupposes the staging of a
second large scale international event and the completion of a
media rights deal in the MENA region. As we optimize near-term
results, we will continue to focus on content creation,
localization and digitization, including the evolution of our
direct-to-consumer network, to drive long-term growth.”
Second-Quarter Consolidated
Results
Revenues declined 5% to $268.9 million from $281.6
million in the prior year quarter with lower revenue from the
Company’s Media, Live Events and Consumer Products business
segments.
Operating Income decreased to $17.1 million from $21.2
million in the prior year quarter, reflecting the decline in
revenue and the impact of certain strategic investments, as
increases in other fixed costs were partially offset by a
year-over-year reduction in accrued management incentive
compensation. The Company’s Operating income margin declined to 6%
from 8% in the prior year quarter.
Adjusted OIBDA (which excludes stock compensation) was
$34.6 million as compared to $43.5 million and the Company’s
Adjusted OIBDA margin was 13% as compared to 15% in the prior year
quarter, respectively. The current period results exceeded guidance
primarily due to enhanced revenue recognized in conjunction with
the Company’s recent event in Saudi Arabia, which is expected to
reverse in connection with an anticipated fourth quarter event in
that country.
Net Income increased slightly to $10.4 million, or $0.11
per diluted share, from $10.0 million, or $0.11 per diluted share,
in the second quarter of 2018, reflecting reduced losses on equity
investments and a lower effective tax rate.
Effective Tax Rate declined to 25% from 31% in the prior
year quarter.
Cash flows used in operating activities were $7.6 million
as compared to $74.2 million of cash generated in the prior year
quarter driven by unfavorable changes in working capital, which was
primarily related to the timing of the Saudi event in June as the
prior year event was held in April, as well as lower operating
performance.
Free Cash Flow was a $27.5 million use of cash as
compared to a $66.4 million source of cash in the second quarter of
2018 primarily driven by the change in operating cash flow and, to
a lesser extent, a $12.1 million increase in capital expenditures
primarily associated with the Company’s workspace plan.4
Cash, cash equivalents and short-term investments were
$296 million as of June 30, 2019, and the Company estimates debt
capacity under its revolving line of credit of approximately
$200 million.
Second-Quarter Key Operating
Metrics
During the first quarter 2019 earnings call, the Company
discussed the absence of several talent and the belief that these
absences had a negative impact on the Company’s engagement metrics.
Since the end of April, the Company has achieved steady improvement
in key measures.
Domestic TV ratings for Raw declined 14% in the first quarter
2019 from the prior year quarter but improved to a year-over-year
decline of 11% in June. The improvement in June occurred despite a
tough comparison to game 5 of the NBA championship on Monday, June
10. Similarly, domestic TV ratings for SmackDown declined 13% in
the first quarter 2019, but improved to a decline of 7% in June,
consistent with the ratings performance of the top 25 cable
networks, which declined 7% during the month. Consumption of WWE
content across digital AVOD platforms rose from a year-over-year
increase of 23% in the first quarter to growth of 28% in June.
Finally, average attendance at the Company’s live events in North
America, which declined 12% in the first quarter, improved to a
decline of 4% for the June period (and was only down 2% for the
second quarter 2019).5
Key Operating Metrics (Year-Over-Year
Change):
Q1 2019
Q2 2019
April
May
June
Domestic TV Ratings:
Raw
(14)
%
(14)
%
(21)
%
(8)
%
(11)
%
SmackDown
(13)
%
(11)
%
(19)
%
(8)
%
(7)
%
Digital Consumption:
Hours
23
%
22
%
14
%
25
%
28
%
Views
15
%
17
%
(1)
%
17
%
38
%
Live Event Attendance:
Average - North America
(12)
%
(2)
%
(12)
%
(6)
%
(4)
%
The Company believes the favorable trends in engagement metrics
stem from the emergence of new storylines and Superstars following
a successful WrestleMania. Management remains excited about the
debut of SmackDown Live on Fox in October. The debut will mark the
first time WWE will be available live 52 weeks a year on a premier
broadcast platform.
The schedule below reflects WWE’s performance by operating
segment (in millions):1
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Net Revenues:
Media
$
197.0
$
202.6
$
332.4
$
336.0
Live Events
48.8
52.3
75.0
83.1
Consumer Products
23.1
26.7
43.9
50.2
Total Net Revenues
$
268.9
$
281.6
$
451.3
$
469.3
Operating Income:
Media
$
26.9
$
32.0
$
43.2
$
67.9
Live Events
12.4
13.4
12.2
16.3
Consumer Products
5.2
4.6
10.2
10.6
Corporate
(27.4)
(28.8)
(55.3)
(51.8)
Total Operating
Income
$
17.1
$
21.2
$
10.3
$
43.0
Adjusted OIBDA:
Media
$
37.5
$
44.5
$
66.0
$
88.1
Live Events
13.3
14.7
14.1
18.3
Consumer Products
6.2
6.9
12.2
13.8
Corporate
(22.4)
(22.6)
(45.3)
(41.5)
Total Adjusted OIBDA
$
34.6
$
43.5
$
47.0
$
78.7
Results by Operating
Segment
Media
Revenues decreased 3% to $197.0 million from $202.6
million in the prior year quarter, primarily due to the performance
of WWE Network and the timing of episodic series (i.e., fewer
episodes delivered) for programs, such as Total Bellas, as
reflected in “Other.” These factors were partially offset by the
contractual escalation of core content rights fees.
WWE Network’s average paid subscribers decreased 6% to
approximately 1.69 million, which was consistent with the Company’s
guidance. For the third quarter 2019, the Company projects average
paid subscribers of approximately 1.53 million, representing a
year-over-year decline of 8%.2,6 Given the actual and projected
subscriber declines, the Company does not expect to achieve record
subscribers for the full year.
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Revenues:
Network (including
pay-per-view)
$
51.8
$
56.2
$
98.8
$
103.0
Core content rights fees 7
69.0
66.2
137.1
131.7
Advertising and sponsorship
18.9
19.6
29.8
31.8
Other 8
57.3
60.6
66.7
69.5
Total Revenues
$
197.0
$
202.6
$
332.4
$
336.0
Operating income was $26.9 million as compared to $32.0
million in the prior year quarter primarily due to the reduction in
revenue and the impact of certain strategic investments. Increases
in other operating expenses were essentially offset by lower
network programming expenses and a reduction in accrued management
incentive compensation.
Adjusted OIBDA was $37.5 million as compared to $44.5
million in the prior year quarter.
Key Highlights: During the quarter, WWE made progress on
critical strategic initiatives, completing content distribution
agreements in key international markets and developing the
foundation for the next iteration of its direct-to-consumer
service, WWE Network. Specifically, the Company completed content
distribution agreements with BT Sport in the U.K., Fox Sports in
Latin America and PP Sports in China. Management believes these
partners provide strong platforms for reaching WWE audiences. The
Company also initiated the transition of WWE Network to a new
platform on July 24, which will provide users with a better
experience, a more intuitive interface, and enhanced search
functionality. The new platform enables the introduction of new
features and experiences over time, including the addition of free
and premium tiers as well as the localization of content in
multiple languages. The Company continued to produce the highest
rated programs on USA Network, Monday Night Raw and SmackDown Live,
while developing other new original programs across platforms.
These included developing new seasons of Miz & Mrs. and Total
Bellas for USA network and E!, respectively, a new series, Fight
Like a Girl, for the mobile platform, Quibi, and a live action
family movie, The Main Event, to premiere on Netflix in 2020.
Live Events
Revenues declined 7% to $48.8 million due to lower ticket
sales at the Company’s international events, which reflected both
the staging of fewer events and weaker performance.
- There were 76 total events (excluding NXT) in the current
quarter, consisting of 53 events in North America and 23 events in
international markets, as compared to 90 events in the prior year
quarter, including 61 events in North America and 29 in
international markets.
- North American ticket sales of $33.6 million were essentially
unchanged from the prior year quarter. The average ticket price at
these events increased 16% to $94.56 primarily due to changes in
the mix of venues, but was offset by the staging of eight fewer
events as the Company worked to optimize the profitability of its
touring schedule. Average attendance declined 2% to approximately
5,800.
- International live event revenue declined $4.0 million driven
by the staging of six fewer events and a 14% reduction in average
attendance to approximately 4,900. Partially offsetting these
factors, the average ticket price increased 6% to $83.34.
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Revenues:
North American ticket sales
$
33.6
$
33.5
$
57.7
$
63.3
International ticket sales
9.5
13.5
9.7
13.5
Advertising and sponsorship
0.8
0.9
1.2
1.1
Other 9
4.9
4.4
6.4
5.2
Total Revenues
$
48.8
$
52.3
$
75.0
$
83.1
Operating income declined to $12.4 million as compared to
$13.4 million in the prior year quarter, primarily due to the
reduction in international ticket sales (as described above).
Adjusted OIBDA was $13.3 million as compared to $14.7
million in the prior year quarter.
Key Highlights: During the quarter, WWE continued to
demonstrate success in staging large-scale, action packed events
for its fans, including WrestleMania, which attracted 82,265 fans
to MetLife Stadium, and Super ShowDown in Jeddah, Saudi Arabia.
Continuing efforts to strengthen WWE’s global talent base, the
Company recently held its largest talent tryout in China with 40
athletes in attendance, and announced that it will return to China
for a fourth straight year when WWE LIVE Shanghai comes to the
Mercedes Benz Arena in September.
Consumer Products
Revenues decreased 13% to $23.1 million from $26.7
million in the prior year quarter primarily due to a decline in
sales of merchandise at the Company’s e-commerce site, WWE Shop,
lower royalties from the sale of toy products and, to a lesser
extent, reduced sales of merchandise at live-event venues, where
the latter can be attributed, in part, to the staging of fewer
events (as described above).
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Revenues:
Consumer product licensing
$
9.4
$
10.8
$
18.8
$
20.1
eCommerce
6.6
8.1
13.2
16.5
Venue merchandise
7.1
7.8
11.9
13.6
Total Revenues
$
23.1
$
26.7
$
43.9
$
50.2
Operating income increased 13% to $5.2 million from $4.6
million in the prior year quarter as the decline in revenue was
more than offset by lower operating expenses, including a decrease
in stock compensation expense.
Adjusted OIBDA was $6.2 million as compared to $6.9
million in the prior year quarter.
Key Highlights: During the quarter, the Company continued
to expand its mobile game portfolio, launching WWE Universe with
marquee publisher Glu Mobile, known for its popular Tap Sports
Baseball game franchise. In addition to the launch of its new
mobile game, WWE also continued to increase the penetration of its
existing mobile games with nearly 115 million installs across its
game portfolio, led by WWE Champions, as of quarter-end. In
collaboration with Mattel, the Company secured premium
merchandising space at Walmart and supported the placement with
“Retailtainment” activities in 1,300 stores over a 4-week span.
Additionally, the Company supported a Mattel social media
influencer campaign generating kids-specific content on YouTube,
that had a positive impact on the sell through of products featured
in that content.
Third Quarter 2019 Business
Outlook
For the third quarter 2019, the Company estimates Adjusted OIBDA
of $17 million to $22 million.6 This range of results represents a
year-over-year decline in Adjusted OIBDA primarily due to increases
in fixed costs, including the impact of investment, as well as
lower WWE Network subscription revenue, which more than offset the
escalation of core content rights fees.
Financial Outlook 2019
The Company reiterated its full year guidance, which targets
revenue of approximately $1 billion and Adjusted OIBDA of at least
$200 million.6 This guidance assumes continued improvement in WWE’s
engagement metrics, a second large scale event in the MENA region,
and the completion of a media rights deal in the MENA region. The
Company believes it has agreements in principle with the Saudi
General Sports Authority on the broad terms for the latter two
items; however, this understanding is nonbinding. It is possible
that either or both of these business developments do not occur on
expected terms and/ or that engagement does not improve as assumed.
The Company has evaluated these potential outcomes and currently
believes that the most likely downside to its Adjusted OIBDA would
be approximately $10 million to $20 million below its current
outlook.
The Company’s full year guidance reflects strong fourth quarter
results with substantial revenue growth from both the Company’s new
content distribution agreements in the U.S., which become effective
in that period, and the aforementioned media rights deal in the
MENA region.
WWE is unable to provide a reconciliation of third quarter or
full year guidance to GAAP measures as, at this time, WWE cannot
accurately determine all of the adjustments that would be
required.
Notes
- The definition of Adjusted OIBDA can be found in the Non-GAAP
Measures section of the release on pages 8-9. A reconciliation of
three and six months ended June 30, 2019 and 2018 Operating Income
to Adjusted OIBDA can be found in the Supplemental Information in
this release on pages 14-15
- Average paid subscribers are calculated based on the arithmetic
daily mean over the relevant period, and may differ substantially
from paid subscribers at the end of any period due to the timing of
paid subscriber additions and losses
- Consumption includes videos viewed on third party (Facebook,
YouTube, Twitter, Instagram, Snapchat, etc.) and WWE platforms
(WWE.com and WWE App). Social media followers represent the number
of followers for each individual platform as sourced from each
platform; as such, total followers shown have not been adjusted for
duplication among or within platforms and do not represent the
number of “unique” followers
- A reconciliation of three and six months ended June 30, 2019
and 2018 Free Cash Flow to Net cash provided by operating
activities can be found in the Supplemental Information in this
release on page 16
- Data based on average viewers per live episode/ game measured
on a Live+SD basis across broadcast and cable networks. Source:
Nielsen Media Research, NPOWER (for more information, see WWE Q2
2019 earnings website presentation at corporate.wwe.com/investors)
- The Company’s business model and expected results (including
our outlook for the third quarter and rest of 2019) will continue
to be subject to significant execution and other risks, including
risks relating to entering into, maintaining and/ or renewing key
agreements, uncertainties associated with international markets and
risks inherent in large live events, and the other risks outlined
in the Company’s Form 10-K filing with the SEC
- Core content rights fees consist primarily of licensing
revenues earned from the distribution of our flagship programs, Raw
and SmackDown, through global broadcast, pay television and digital
platforms
- Other forms of media monetization reflect revenues earned from
the distribution of other content, including, but not limited to,
certain live in-ring programming content in international markets,
scripted, reality and other programming, theatrical and
direct-to-home video releases
- Other Live Events includes revenue from the sale of travel
packages associated with the Company’s live events, and commissions
earned through secondary ticketing as well as revenue from events
for which the Company receives a fixed fee
Non-GAAP Measures
The Company defines Adjusted OIBDA as operating income
excluding depreciation and amortization, stock-based compensation
expense, certain impairment charges and other non-recurring
material items that otherwise would impact the comparability of
results between periods. Adjusted OIBDA includes amortization
expenses directly related to the Company's revenue generating
activities, including feature film and television production asset
amortization, amortization of costs related to content delivery and
technology assets utilized for the WWE Network, as well as
amortization of right-of-use assets related to finance leases of
equipment used to produce and broadcast our live events. The
Company believes the presentation of Adjusted OIBDA is relevant and
useful for investors because it allows them to view the Company’s
segment performance in the same manner as the primary method used
by management to evaluate segment performance and to make decisions
regarding the allocation of resources. Additionally, the Company
believes that Adjusted OIBDA is a primary measure used by media
investors, analysts and peers for comparative purposes.
Adjusted OIBDA is a non-GAAP financial measure and may be
different than similarly-titled non-GAAP financial measures used by
other companies. WWE views operating income as the most directly
comparable GAAP measure. Adjusted OIBDA (and other non-GAAP
measures such as Adjusted Operating Income, Adjusted Net Income and
Adjusted EPS presented to exclude certain material items that
impact the comparability between periods) should not be considered
in isolation from, or as a substitute for, operating income or
other GAAP measures, such as net income or operating cash flow, as
an indicator of operating performance or liquidity.
The Company defines Free Cash Flow as net cash provided
by operating activities less cash used for capital expenditures.
WWE views net cash provided by operating activities as the most
directly comparable GAAP measure. Although it is not a recognized
measure of liquidity under U.S. GAAP, Free Cash Flow provides
useful information regarding the amount of cash WWE’s continuing
business generates after capital expenditures and is available for
reinvesting in the business, debt service, payment of dividends,
and the repurchase of stock.
Additional Information
Additional business metrics are made available to investors on
the corporate website - corporate.wwe.com/investors. Note: As previously
announced WWE will host a conference call at 11:00 a.m. ET on July
25th to discuss the Company's earnings results for the second
quarter of 2019. All interested parties are welcome to listen to a
live web cast that will be hosted through the Company’s web site at
corporate.wwe.com/investors.
Participants can access the conference call by dialing
1-855-200-4993 (toll free) or 1-323-794-2092 from outside the U.S.
(conference ID for both lines: 6382878). Please reserve a line 5-10
minutes prior to the start time of the conference call.
The earnings presentation referenced during the call will be
made available on July 25, 2019 at corporate.wwe.com/investors. A replay of the call
will be available approximately two hours after the conference call
concludes, and can be accessed on the Company’s web site.
About WWE
WWE, a publicly traded company (NYSE: WWE), is an integrated
media organization and recognized leader in global entertainment.
The Company consists of a portfolio of businesses that create and
deliver original content 52 weeks a year to a global audience. WWE
is committed to family friendly entertainment on its television
programming, pay-per-view, digital media and publishing platforms.
WWE’s TV-PG, family-friendly programming can be seen in more than
800 million homes worldwide in 25 languages. WWE Network, the
first-ever 24/7 over-the-top premium network that includes all live
pay-per-views, scheduled programming and a massive video-on-demand
library, is currently available in more than 180 countries. The
Company is headquartered in Stamford, Conn., with offices in New
York, Los Angeles, London, Mexico City, Mumbai, Shanghai,
Singapore, Dubai, Munich and Tokyo.
Additional information on WWE (NYSE: WWE) can be found at
wwe.com and corporate.wwe.com. For information on our global
activities, go to http://www.wwe.com/worldwide/.
Trademarks: All WWE programming,
talent names, images, likenesses, slogans, wrestling moves,
trademarks, logos and copyrights are the exclusive property of WWE
and its subsidiaries. All other trademarks, logos and copyrights
are the property of their respective owners.
Forward-Looking Statements: This
press release contains forward-looking statements pursuant to the
safe harbor provisions of the Securities Litigation Reform Act of
1995, which are subject to various risks and uncertainties. These
risks and uncertainties include, without limitation, risks relating
to: entering, maintaining and renewing major distribution and event
agreements; WWE Network (including the risk that we are unable to
attract, retain and renew subscribers); our need to continue to
develop creative and entertaining programs and events; the
possibility of a decline in the popularity of our brand of sports
entertainment; the continued importance of key performers and the
services of Vincent K. McMahon; possible adverse changes in the
regulatory atmosphere and related private sector initiatives; the
highly competitive, rapidly changing and increasingly fragmented
nature of the markets in which we operate and greater financial
resources or marketplace presence of many of our competitors;
uncertainties associated with international markets including
possible disruptions and reputational risks; our difficulty or
inability to promote and conduct our live events and/or other
businesses if we do not comply with applicable regulations; our
dependence on our intellectual property rights, our need to protect
those rights, and the risks of our infringement of others’
intellectual property rights; the complexity of our rights
agreements across distribution mechanisms and geographical areas;
potential substantial liability in the event of accidents or
injuries occurring during our physically demanding events
including,
without limitation, claims alleging traumatic brain injury;
large public events as well as travel to and from such events; our
feature film business; our expansion into new or complementary
businesses and/or strategic investments; our computer systems and
online operations; privacy norms and regulations; a possible
decline in general economic conditions and disruption in financial
markets; our accounts receivable; our indebtedness including our
convertible notes; litigation; our potential failure to meet market
expectations for our financial performance, which could adversely
affect our stock; Vincent K. McMahon exercises control over our
affairs, and his interests may conflict with the holders of our
Class A common stock; a substantial number of shares are eligible
for sale by the McMahons and the sale, or the perception of
possible sales, of those shares could lower our stock price; and
the volatility of our Class A common stock. In addition, our
dividend is dependent on a number of factors, including, among
other things, our liquidity and historical and projected cash flow,
strategic plan (including alternative uses of capital), our
financial results and condition, contractual and legal restrictions
on the payment of dividends (including under our revolving credit
facility), general economic and competitive conditions and such
other factors as our Board of Directors may consider relevant.
Forward-looking statements made by the Company speak only as of the
date made and are subject to change without any obligation on the
part of the Company to update or revise them. Undue reliance should
not be placed on these statements. For more information about risks
and uncertainties associated with the Company’s business, please
refer to the “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and “Risk Factors” sections of
the Company’s SEC filings, including, but not limited to, our
annual report on Form 10-K and quarterly reports on Form 10-Q.
World Wrestling
Entertainment, Inc.
Consolidated Income
Statements
(In millions, except per share
data)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Net revenues
$
268.9
$
281.6
$
451.3
$
469.3
Operating expenses
197.4
198.9
332.8
318.9
Marketing and selling expenses
24.9
29.7
48.0
49.6
General and administrative expenses
23.6
24.9
47.9
44.6
Depreciation and amortization
5.9
6.9
12.3
13.2
Operating income
17.1
21.2
10.3
43.0
Interest expense
4.0
4.7
10.3
8.2
Other income (expense), net
0.8
(2.0)
2.6
(0.2)
Income before income taxes
13.9
14.5
2.6
34.6
Provision for income taxes
3.5
4.5
0.6
9.8
Net income
$
10.4
$
10.0
$
2.0
$
24.8
Earnings per share:
Basic
$
0.13
$
0.13
$
0.03
$
0.32
Diluted
$
0.11
$
0.11
$
0.02
$
0.29
Weighted average common shares
outstanding:
Basic
78.0
77.2
78.0
77.2
Diluted
91.1
87.1
91.1
85.2
Dividends declared per common share (Class
A and B)
$
0.12
$
0.12
$
0.24
$
0.24
World Wrestling
Entertainment, Inc.
Consolidated Balance
Sheets
(In millions)
(Unaudited)
As of
June 30,
December 31,
2019
2018
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
98.2
$
167.5
Short-term investments, net
197.8
191.7
Accounts receivable, net
132.1
78.9
Inventory
7.6
7.7
Prepaid expenses and other
current assets
26.4
28.2
Total current assets
462.1
474.0
PROPERTY AND EQUIPMENT, NET
173.2
148.1
FINANCE LEASE RIGHT-OF-USE ASSETS, NET
12.6
—
OPERATING LEASE RIGHT-OF-USE ASSETS,
NET
21.3
—
FEATURE FILM PRODUCTION ASSETS, NET
15.4
13.6
TELEVISION PRODUCTION ASSETS, NET
6.8
7.5
INVESTMENT SECURITIES
28.6
30.2
NON-CURRENT DEFERRED INCOME TAX ASSETS
16.6
17.1
OTHER ASSETS, NET
6.3
9.8
TOTAL ASSETS
$
742.9
$
700.3
LIABILITIES AND STOCKHOLDERS’
EQUITY
CURRENT LIABILITIES:
Current portion of long-term
debt
$
5.2
$
5.1
Finance lease liabilities
8.5
—
Operating lease liabilities
6.9
—
Convertible debt
185.9
183.1
Accounts payable and accrued
expenses
112.2
120.1
Deferred income
55.4
49.2
Total current liabilities
374.1
357.5
LONG-TERM DEBT
23.1
25.7
FINANCE LEASE LIABILITIES
5.2
—
OPERATING LEASE LIABILITIES
14.6
—
OTHER NON-CURRENT LIABILITIES
0.6
0.9
Total liabilities
417.6
384.1
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
Class A common stock
0.5
0.4
Class B convertible common
stock
0.3
0.3
Additional paid-in capital
440.8
415.3
Accumulated other comprehensive
income
2.5
1.5
Accumulated deficit
(118.8)
(101.3)
Total stockholders’ equity
325.3
316.2
TOTAL LIABILITIES AND STOCKHOLDERS’
EQUITY
$
742.9
$
700.3
World Wrestling
Entertainment, Inc.
Consolidated Statements of
Cash Flows
(In millions)
(Unaudited)
Six Months Ended
June 30,
2019
2018
OPERATING ACTIVITIES:
Net income
$
2.0
$
24.8
Adjustments to reconcile net
income to net cash (used in) provided by operating activities:
Amortization and impairments of
feature film production assets
1.8
3.5
Amortization of television
production assets
12.9
12.8
Depreciation and
amortization
16.0
16.6
Loss on equity investments,
net
2.6
3.0
Services provided in exchange
for equity instruments
(1.1)
(1.6)
Other amortization
7.0
3.1
Stock-based compensation
24.4
22.5
Provision for (benefit from)
deferred income taxes
0.5
(0.1)
Other non-cash adjustments
1.5
2.1
Cash (used in) provided by
changes in operating assets and liabilities:
Accounts receivable
(53.3)
(7.2)
Inventory
0.1
(0.3)
Prepaid expenses and other
assets
1.8
(5.2)
Feature film production
assets
(3.5)
(0.6)
Television production
assets
(12.2)
(14.4)
Accounts payable, accrued
expenses and other liabilities
(8.5)
6.4
Deferred income
7.1
11.4
Net cash (used in) provided by
operating activities
(0.9)
76.8
INVESTING ACTIVITIES:
Purchases of property and
equipment and other assets
(36.7)
(12.2)
Purchases of short-term
investments
(63.6)
(64.5)
Proceeds from sales and
maturities of investments
58.8
36.1
Purchase of investment
securities
(1.0)
—
Other
—
1.0
Net cash used in investing
activities
(42.5)
(39.6)
FINANCING ACTIVITIES:
Repayment of debt
(2.5)
(2.3)
Repayment of finance leases
(4.1)
—
Dividends paid
(18.7)
(18.5)
Debt issuance costs
(0.7)
—
Taxes paid related to net
settlement upon vesting of equity awards
(0.3)
(0.2)
Proceeds from issuance of
stock
1.3
0.9
Repurchase and retirement of
common stock
(0.9)
—
Net cash used in financing
activities
(25.9)
(20.1)
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS
(69.3)
17.1
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD
167.5
137.7
CASH AND CASH EQUIVALENTS, END
OF PERIOD
$
98.2
$
154.8
NON-CASH INVESTING TRANSACTIONS:
Purchases of property and
equipment recorded in accounts payable and accrued expenses
$
13.8
$
3.6
World Wrestling
Entertainment, Inc.
Supplemental Information –
Reconciliation of Adjusted OIBDA
(In millions, except per share
data)
(Unaudited)
Three Months Ended June 30,
2019
Operating Income
Depreciation &
Amortization
Stock Compensation
Other Adjustments
Adjusted OIBDA
Media
$
26.9
$
2.1
$
8.5
$
—
$
37.5
Live Events
12.4
—
0.9
—
13.3
Consumer Products
5.2
—
1.0
—
6.2
Corporate
(27.4)
3.8
1.2
—
(22.4)
Total
$
17.1
$
5.9
$
11.6
$
—
$
34.6
Three Months Ended June 30,
2018
Operating Income
Depreciation &
Amortization
Stock Compensation
Other Adjustments
Adjusted OIBDA
Media
$
32.0
$
3.0
$
9.5
$
—
$
44.5
Live Events
13.4
—
1.3
—
14.7
Consumer Products
4.6
—
2.3
—
6.9
Corporate
(28.8)
3.9
2.3
—
(22.6)
Total
$
21.2
$
6.9
$
15.4
$
—
$
43.5
Six Months Ended June 30,
2019
Operating Income
Depreciation &
Amortization
Stock Compensation
Other Adjustments
Adjusted OIBDA
Media
$
43.2
$
4.9
$
17.9
$
—
$
66.0
Live Events
12.2
—
1.9
—
14.1
Consumer Products
10.2
—
2.0
—
12.2
Corporate
(55.3)
7.4
2.6
—
(45.3)
Total
$
10.3
$
12.3
$
24.4
$
—
$
47.0
Six Months Ended June 30,
2018
Operating Income
Depreciation &
Amortization
Stock Compensation
Other Adjustments
Adjusted OIBDA
Media
$
67.9
$
6.0
$
14.2
$
—
$
88.1
Live Events
16.3
—
2.0
—
18.3
Consumer Products
10.6
—
3.2
—
13.8
Corporate
(51.8)
7.2
3.1
—
(41.5)
Total
$
43.0
$
13.2
$
22.5
$
—
$
78.7
World Wrestling Entertainment,
Inc.
Supplemental Information -
Reconciliation of Business Outlook
(In millions, except per share
data)
(Unaudited)
Reconciliation of Adjusted OIBDA to
Operating Income
Q2 2019
Q2 2019 YTD
Q3 2019
FY 2019
Adjusted OIBDA
$
34.6
$
47.0
$17 - $22
At least $200
Depreciation & amortization
(5.9)
(12.3)
—
—
Stock-based compensation
(11.6)
(24.4)
—
—
Film impairments (1)
—
—
—
—
Asset impairments (1)
—
—
—
—
Gain (losses) on operating assets (1)
—
—
—
—
Restructuring charges (1)
—
—
—
—
Other operating income items (1)
—
—
—
—
Operating income (U.S. GAAP
Basis)
$
17.1
$
10.3
Not estimable
Not estimable
- Because of the nature of these items, WWE is unable to estimate
the amounts of any adjustments for these items for periods after
June 30, 2019 due to its inability to forecast if or when such
items will occur. These items are inherently unpredictable and may
not be reliably quantified.
World Wrestling Entertainment,
Inc.
Supplemental Information -
Free Cash Flow
(In millions)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2019
2018
2019
2018
Net cash (used in) provided by operating
activities
$
(7.6)
$
74.2
$
(0.9)
$
76.8
Less cash used for capital
expenditures:
Purchase of property and equipment and
other assets
(19.9)
(7.8)
(36.7)
(12.2)
Free Cash Flow
$
(27.5)
$
66.4
$
(37.6)
$
64.6
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190725005250/en/
Investors: Michael Weitz 203-352-8642 Michael Guido, CFA
203-352-8779 Media: Matthew Altman 203-352-1177
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