Raises Full Year 2022 Outlook
Second Quarter 2022
Highlights
- Revenue was $328.2 million, an increase of 24%; Operating
Income was $69.3 million, an increase of 50%; and Adjusted OIBDA1
was $91.5 million, an increase of 34%
- Returned capital to shareholders totaling $19.1 million,
including share repurchases and dividends paid
- Each WWE premium live event (WrestleMania, WrestleMania
Backlash and Hell in a Cell) was the most viewed event in its
history with year-over-year increases of 60%, 49% and 45%,
respectively, in domestic unique viewership on Peacock
- WWE, in connection with Fox’s Blockchain Creative Labs,
launched its inaugural NFT sale on Moonsault, the Company’s
official NFT marketplace. The limited-edition collection, which was
tied to the Hell in a Cell event, sold out within 24 hours
- WWE announced its second “Next In Line” class of 15 college
athletes, further enhancing the Company’s talent development
program
- In July, WWE launched a new, enhanced digital platform for
e-commerce and licensed merchandise in connection with its
long-term partnership with Fanatics
2022 Business Outlook2
- In February, the Company issued Adjusted OIBDA guidance of $360
- $375 million for the full year 2022. Based on outperformance
through the first six months of the year as well as management’s
current expectations for the second half of the year, the Company
is raising its guidance and now expects full year 2022 Adjusted
OIBDA within a range of $370 - $385 million
WWE (NYSE: WWE) today announced financial
results for its second quarter ended June 30, 2022.
“We generated strong financial results in the quarter,
highlighted by record revenue and Adjusted OIBDA for a second
quarter,” said Stephanie McMahon and Nick Khan, WWE co-Chief
Executive Officers. “We continued to effectively execute our
strategy, including staging a record-setting WrestleMania in early
April. WrestleMania, as well as our other premium live events
(“PLEs”) including WrestleMania Backlash, Hell in a Cell, Money in
the Bank and SummerSlam all delivered record viewership for their
respective events. These PLEs, along with strong ratings for our
flagship programs, Raw and SmackDown, continued to expand the reach
of our brands and enhance the value of our content. We’re excited
about the recently announced management structure, including the
appointment of Paul Levesque as head of WWE creative and talent, as
we look to continue to increase the monetization of our IP across
various platforms through our media rights agreements, both
domestically and abroad, as well as our inaugural NFT drops on
Moonsault, WWE’s official NFT marketplace, and the recent launch of
our new, enhanced e-commerce digital platform in connection with
our partnership with Fanatics.”
Frank Riddick, WWE Chief Financial and Administrative Officer,
added “In the quarter, we exceeded the high end of our guidance.
Adjusted OIBDA increased 34% reflecting 24% revenue growth. Our
strong financial performance was primarily driven by our return to
a full live event schedule and our consumer products business.
These items more than offset an increase in production,
content-related, and other expenses. For 2022, we are raising our
full year Adjusted OIBDA guidance to a range of $370 to $385
million.”
Second-Quarter Consolidated
Results
Revenue increased 24% to $328.2 million, primarily due to
an increase in ticket sales at our live events and, to a lesser
extent, higher sales of the Company’s licensed products, including
video games and trading cards. An increase in media rights fees
related to the Company’s flagship programs and premium live events
also contributed to the increase in revenue.
Operating Income increased 50%, or $23.0 million, to
$69.3 million, driven by the increase in revenue partially offset
by an increase in operating expenses. The increase in operating
expenses was primarily driven by higher event-related costs
associated with the resumption of live event touring as well as
increased production costs associated with the creation of the
Company’s premium live events, including our annual WrestleMania
events. The Company’s operating income margin increased to 21% from
17%.
Adjusted OIBDA (which excludes stock compensation)
increased 34%, or $23.4 million, to $91.5 million. The Company’s
adjusted OIBDA margin increased to 28% from 26%.
Net Income was $49.0 million, or $0.58 per diluted share,
an increase from $29.2 million, or $0.34 per diluted share in the
second quarter of 2021, primarily reflecting higher operating
performance.
Cash flows generated by operating activities were $56.9
million, an increase from $19.5 million, primarily due to higher
net income.
Free Cash Flow3 was $9.5 million, a decrease from $13.3
million, primarily due to an increase in capital expenditures,
partially offset by the change in operating cash flow. For the
three months ended June 30, 2022, the Company incurred $40.8
million of capital expenditures related to its new headquarter
facility. Excluding the capital expenditures related to the new
headquarter facility, Free Cash Flow for the three months ended
June 30, 2022 was $50.3 million.
Return of Capital to
Shareholders
The Company returned $19.1 million to shareholders in the second
quarter of 2022, consisting of $10.0 million in share
repurchases and $9.1 million in dividends paid.
Approximately 170,000 shares were repurchased at an average price
of $58.70 per share during the second quarter. As of June 30, 2022,
the Company had $210.9 million available under its existing $500
million stock repurchase authorization.
Results by Operating
Segment
The schedules below reflect WWE’s performance by operating
segment (in millions):1
Three Months Ended
Six Months Ended
June 30,
June 30,
2022
2021
2022
2021
Net Revenue:
Media
$
243.1
$
233.9
$
521.2
$
475.9
Live Events
41.0
9.2
64.1
9.7
Consumer Products
44.1
22.5
76.3
43.5
Total Net Revenue
$
328.2
$
265.6
$
661.6
$
529.1
Operating Income (Loss):
Media
$
78.4
$
80.8
$
195.8
$
177.9
Live Events
13.2
0.9
15.2
(3.6
)
Consumer Products
15.9
7.9
27.1
14.1
Corporate
(38.2
)
(43.3
)
(76.4
)
(77.0
)
Total Operating Income
$
69.3
$
46.3
$
161.7
$
111.4
Adjusted OIBDA:
Media
$
90.7
$
86.2
$
218.9
$
192.8
Live Events
13.8
1.1
16.6
(3.2
)
Consumer Products
16.5
8.4
28.4
15.1
Corporate
(29.5
)
(27.6
)
(60.7
)
(52.7
)
Total Adjusted OIBDA
$
91.5
$
68.1
$
203.2
$
152.0
Media
Second-Quarter 2022
Revenue increased 4%, or $9.2 million, to $243.1 million,
primarily due an increase in both domestic and international media
rights fees related to the Company’s flagship programs and premium
live events. These increases were partially offset by the timing of
delivery of third-party original programming.
Three Months Ended
Six Months Ended
June 30,
June 30,
2022
2021
2022
2021
Media Revenue:
Network (a)
$
63.7
$
61.5
$
120.0
$
140.9
Core content rights fees (b)
151.8
141.8
293.3
281.5
Advertising and sponsorship (c)
17.9
18.7
37.7
34.3
Other (d)
9.7
11.9
70.2
19.2
Total Revenue
$
243.1
$
233.9
$
521.2
$
475.9
(a)
Network revenue consists primarily of
license fees associated with the distribution of WWE Network
content on the Peacock service in the U.S. (effective March 18,
2021), as well as subscription fees from customers of WWE Network
and license fees associated with the Company’s international
licensed partner agreements. Network revenue for the six-month
period ended June 30, 2021, includes the upfront revenue
recognition related to the delivery of certain WWE Network
intellectual property rights to Peacock.
(b)
Core content rights fees consist primarily
of licensing revenue from the distribution of the Company’s
flagship programs, Raw and SmackDown, as well as its NXT
programming, through global broadcast, pay television and digital
platforms.
(c)
Advertising and sponsorship revenue within
the Media segment consists primarily of advertising revenue from
the Company’s content on third-party social media platforms and
sponsorship fees from sponsors who promote products utilizing the
Company’s media platforms, including promotion on the Company’s
digital websites and on-air promotional media spots.
(d)
Other revenue within the Media segment
reflects revenue from the distribution of other WWE content,
including, but not limited to, certain live in-ring programming
content in international markets, scripted, reality and other
programming, as well as theatrical and direct-to-home video
releases.
Operating income decreased 3%, or $2.4 million, to $78.4
million, as the increase in revenue (as described above) was more
than offset by an increase in operating expenses. The increase in
operating expenses was primarily driven by higher stock-based
compensation as the prior year quarter included lower management
incentive compensation arising from the Company’s business
restructuring. Production costs were relatively flat year-over-year
as higher production costs associated with the creation of the
Company’s premium live events were offset by lower television
production costs associated with the creation of the Company’s
weekly, in-ring content.
Adjusted OIBDA increased 5%, or $4.5 million, to $90.7
million.
Live Events
Second-Quarter 2022
Revenue was $41.0 million, an increase of $31.8 million,
driven by the resumption of ticket sales as the Company returned to
staging ticketed live events, as well as an increase in ticket
sales from the Company’s marquee annual event, WrestleMania. There
were 59 total ticketed live events in the current quarter,
consisting of 55 events in North America and four events in
international markets. Average attendance at the Company’s North
America events was approximately 6,800. The increase in ticket
sales revenue for WrestleMania was primarily driven by a return to
full capacity attendance.
Three Months Ended
Six Months Ended
June 30,
June 30,
2022
2021
2022
2021
Live Events Revenue:
North American ticket sales
$
34.9
$
6.7
$
54.8
$
6.7
International ticket sales
2.2
—
2.2
—
Advertising and sponsorship (e)
1.6
0.3
2.7
0.3
Other (f)
2.3
2.2
4.4
2.7
Total Revenue
$
41.0
$
9.2
$
64.1
$
9.7
(e)
Advertising and sponsorship revenue within the Live Events
segment consists primarily of fees from advertisers and sponsors
that promote products utilizing the Company’s live events (i.e.,
presenting sponsor of fan engagement events and advertising signage
at events).
(f)
Other revenue within the Live Events segment reflects revenue
from the sale of travel packages associated with the Company’s
global live events, commissions earned through secondary ticketing,
and revenue from events for which the Company receives a fixed
fee
Operating income was $13.2 million, an increase of $12.3
million, as the increase in ticket sales (as described above) was
partially offset by an increase in event-related expenses.
Adjusted OIBDA increased $12.7 million to $13.8
million.
Consumer Products
Second-Quarter 2022
Revenue increased 96%, or $21.6 million, to $44.1
million, primarily due to higher sales of the Company’s licensed
products, including video games driven by our franchise game WWE
2K22, as well as trading cards and other collectibles. Higher sales
of venue merchandise was driven by the return to ticketed live
events, while an increase in eCommerce merchandise sales was
primarily due to sales of the Company’s existing merchandise
inventory to the new operator of WWE’s official eCommerce
platform.
Three Months Ended
Six Months Ended
June 30,
June 30,
2022
2021
2022
2021
Consumer Products Revenue:
Consumer product licensing
$
22.6
$
11.3
$
42.6
$
22.3
eCommerce
12.9
9.9
20.6
19.9
Venue merchandise
8.6
1.3
13.1
1.3
Total Revenue
$
44.1
$
22.5
$
76.3
$
43.5
Operating income increased 101%, or $8.0 million, to
$15.9 million, reflecting the increase in revenue (as described
above) partially offset by an increase in variable costs associated
with the sales activity.
Adjusted OIBDA increased 96%, or $8.1 million, to $16.5
million.
2022 Business Outlook2
In February, the Company issued Adjusted OIBDA guidance of $360
- $375 million for the full year 2022. Based on outperformance
through the first six months of the year as well as management’s
current expectations for the second half of the year, the Company
is raising its guidance and now expects full year 2022 Adjusted
OIBDA within a range of $370 - $385 million. This range of
anticipated performance reflects the continued ramp-up of live
events, including large-scale international events, and increased
monetization of content, partially offset by increased production,
content-related, and other expenses.
Third Quarter 2022 Business
Outlook2
The Company estimates third quarter 2022 Adjusted OIBDA of $70 -
$80 million. The estimate reflects strong revenue growth primarily
driven by the contractual escalation of domestic media rights fees
for the Company’s flagship programs and premium live events as well
as the increased monetization of content and an increase in
international ticket sales related to the staging of a large-scale
event. The Company also anticipates that third quarter results will
reflect an increase in operating expenses, including certain costs
to support the creation of content.
Special Committee
Investigation
As previously announced, a Special Committee of independent
members of the Board of Directors was formed to investigate alleged
misconduct by Vincent K. McMahon, the Company’s former Chairman and
Chief Executive Officer, who resigned from all positions held with
the Company on July 22, 2022 but remains a stockholder with a
controlling interest, and another executive, who is also no longer
with the Company. The Special Committee investigation is
substantially complete. Based on certain findings during the
investigation, the Company has revised its previously issued
financial statements for the years ended December 31, 2019, 2020,
and 2021, as well as the first quarter of 2022. For the three and
six-month periods ended June 30, 2022, the Company’s consolidated
pre-tax results include the impact of $1.7 million associated with
certain costs related to the investigation. Please see the
Company’s SEC filings, including, but not limited to, its annual
report on Form 10-K/A and quarterly reports on Form 10-Q/A and Form
10-Q for further details regarding this matter.
Notes
(1)
The definition of Adjusted OIBDA can be found in the Non-GAAP
Measures section of the release on page 7. A reconciliation of
Operating Income to Adjusted OIBDA for the three and six-month
periods ended June 30, 2022 and 2021 can be found in the
Supplemental Information in this release on page 14.
(2)
The Company’s business model and expected results will continue
to be subject to significant execution and other risks, including
risks relating to the impact of COVID-19 on WWE’s business, results
of operations and financial condition; entering, maintaining and
renewing major distribution agreements; WWE Network; risks related
to the resignation of Vincent K. McMahon and the potential impact
of the investigation of alleged executive misconduct; uncertainties
associated with international markets and risks inherent in large
live events, and other risk factors disclosed in our annual report
on Form 10-K/A for the year ended December 31, 2021. In addition,
WWE is unable to provide a reconciliation of third quarter or full
year 2022 guidance to GAAP measures as, at this time, WWE cannot
accurately determine all of the adjustments that would be required.
See Supplemental Information in this release on page 15.
(3)
A reconciliation of Net Cash Provided by Operating Activities to
Free Cash Flow for the three and six-month periods ended June 30,
2022 and 2021 can be found in the Supplemental Information in this
release on page 16.
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 and
depreciation expenses directly related to supporting the operations
of our segments, including content production asset amortization,
depreciation and 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 from 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 which are defined as the GAAP
measures excluding certain nonrecurring, material items that impact
the comparability between periods) should not be considered in
isolation from, or as a substitute for, operating income, net
income, EPS or other GAAP measures, such as 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, share repurchases and
payment of dividends.
Additional Information
As previously announced WWE will host a conference call at 8:30
a.m. ET on August 16, 2022, to discuss its second quarter 2022
results. All interested parties are welcome to listen to a live
webcast that will be hosted through the Company’s website 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: 6930081). 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 August 16, 2022, 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 website.
Additional business metrics are made available to investors on
the corporate website - corporate.wwe.com/investors.
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, premium live events, digital media, and publishing
platforms. WWE’s TV-PG programming can be seen in more than 1
billion homes worldwide in 30 languages through world-class
distribution partners including NBCUniversal, FOX, BT Sport, Sony
India and Rogers. The award-winning WWE Network includes all
premium live events, scheduled programming and a massive
video-on-demand library and is currently available in more than 180
countries. In the United States, NBCUniversal’s streaming service,
Peacock, is the exclusive home to WWE Network.
Additional information on WWE can be found at wwe.com and
corporate.wwe.com.
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, and oral statements made from time to time
by our representatives may contain, forward-looking statements
pursuant to the safe harbor provisions of the Securities Litigation
Reform Act of 1995. Forward looking statements include statements
regarding, our outlook for future financial results, the impact of
recent management changes, the scope, duration and findings of the
investigation being conducted by the special committee of
independent members of our Board of Directors; our plans to
remediate identified material weaknesses in our disclosure control
and procedures and our internal control over financial reporting,
and regulatory, investigative or enforcement inquiries, subpoenas
or demands arising from, related to, or in connection with these
matters. In addition, the words “may,” “will,” “could,”
“anticipate,” “plan,” “continue,” “project,” “intend,” “estimate,”
“believe,” “expect,” “outlook,” “target,” “goal,” “guidance” and
similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
such words. These statements relate to future possible events, as
well as our plans, objectives, expectations and intentions and are
not historical facts and accordingly involve known and unknown
risks and uncertainties and other factors that may cause the actual
results or the performance by us to be materially different from
future results or performance expressed or implied by such
forward-looking statements. These forward-looking statements are
subject to uncertainties relating to, without limitation, the
departure of Vince McMahon from the Company and the appointment of
Stephanie McMahon and Nick Khan as co-Chief Executive Officers; the
scope, duration and findings of the ongoing investigation by the
special committee of independent members of our Board of Directors;
regulatory, investigative or enforcement inquiries, subpoenas or
demands arising from, related to, or in connection with these
matters; our ability to remediate material weaknesses in our
disclosure controls and procedures and our internal control over
financial reporting; and reputational harm to the Company’s
relationships with its stockholders, customers, talent and
partners, which may have adverse financial and operational impacts,
among other factors. The following additional factors, among
others, could cause actual results to differ materially from those
contained in forward-looking statements: the COVID-19 outbreak,
which may continue to affect negatively world economies as well as
our industry, business and results of operations; entering,
maintaining and renewing major distribution and licensing
agreements; a rapidly evolving and highly competitive media
landscape; WWE Network; computer systems, content delivery and
online operations of our Company and our business partners; privacy
norms and regulations; our need to continue to develop creative and
entertaining programs and events; our need to retain and continue
to recruit key performers; the possibility of a decline in the
popularity of our brand of sports entertainment; the resignation 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/or our inability to compete
effectively, especially against competitors with greater financial
resources or marketplace presence; 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; large public events as well as travel to and from
such events; our expansion into new or complementary businesses,
strategic investments and/or acquisitions; our accounts receivable;
the construction and move to our new leased corporate and media
production headquarters; litigation and other actions,
investigations or proceedings; a change in the tax laws of key
jurisdictions; our feature film business; a possible decline in
general economic conditions and disruption in financial markets
including any resulting from COVID-19; our indebtedness including
our convertible notes; our potential failure to meet market
expectations for our financial performance; through his beneficial
ownership of a substantial majority of our Class B common stock,
our controlling stockholder, Vincent K. McMahon could exercise
ultimate control over our affairs, and his interests may conflict
with the holders of our Class A common stock; our share repurchase
program; 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 and share
repurchases are 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/A and quarterly reports on Form 10-Q/A
and 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,
2022
2021
2022
2021
Net revenues
$
328.2
$
265.6
$
661.6
$
529.1
Operating expenses
196.9
156.1
377.6
298.2
Marketing and selling expenses
20.1
16.0
38.5
34.9
General and administrative expenses
32.4
36.3
64.6
62.9
Depreciation and amortization
9.5
10.9
19.2
21.7
Operating income
69.3
46.3
161.7
111.4
Interest expense
4.7
8.5
11.0
17.0
Other (expense) income, net
(0.2
)
(0.1
)
0.1
0.4
Income before income taxes
64.4
37.7
150.8
94.8
Provision for income taxes
15.4
8.5
35.7
21.8
Net income
$
49.0
$
29.2
$
115.1
$
73.0
Earnings per share:
Basic
$
0.66
$
0.38
$
1.54
$
0.95
Diluted
$
0.58
$
0.34
$
1.35
$
0.85
Weighted average common shares
outstanding:
Basic
74.3
76.3
74.5
76.8
Diluted
87.9
85.5
87.7
85.6
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,
2022
2021
Assets
Current assets:
Cash and cash equivalents
$
110.1
$
134.8
Short-term investments, net
333.4
281.0
Accounts receivable, net
176.7
171.2
Inventory
4.8
8.0
Prepaid expenses and other current
assets
53.5
32.2
Total current assets
678.5
627.2
Property and equipment, net
226.1
172.7
Finance lease right-of-use assets, net
303.9
313.4
Operating lease right-of-use assets,
net
13.7
9.0
Content production assets, net
16.8
13.8
Investment securities
11.7
11.6
Deferred income tax assets, net
19.0
13.1
Other assets, net
9.4
43.3
Total assets
$
1,279.1
$
1,204.1
Liabilities and Stockholders'
Equity
Current liabilities:
Current portion of long-term debt
$
0.4
$
0.4
Finance lease liabilities
12.7
12.2
Operating lease liabilities
3.7
4.8
Convertible debt
213.6
201.1
Accounts payable and accrued expenses
124.0
122.7
Deferred revenues
70.8
74.6
Total current liabilities
425.2
415.8
Long-term debt
21.1
21.3
Finance lease liabilities
367.3
374.7
Operating lease liabilities
10.7
5.1
Other non-current liabilities
13.9
12.5
Total liabilities
838.2
829.4
Commitments and contingencies
Stockholders' equity:
Class A common stock
0.4
0.4
Class B convertible common stock
0.3
0.3
Additional paid-in capital
410.4
422.9
Accumulated other comprehensive income
(0.2
)
2.4
Retained earnings (accumulated
deficit)
30.0
(51.3
)
Total stockholders’ equity
440.9
374.7
Total liabilities and stockholders'
equity
$
1,279.1
$
1,204.1
World Wrestling Entertainment,
Inc.
Consolidated Statements of
Cash Flows
(In millions)
(Unaudited)
Six Months Ended
June 30,
2022
2021
OPERATING ACTIVITIES:
Net income
$
115.1
$
73.0
Adjustments to reconcile net income to net
cash provided by operating activities:
Amortization and impairments of content
production assets
16.9
16.0
Depreciation and amortization
23.8
25.4
Other amortization
6.6
9.0
Stock-based compensation
20.6
10.8
Provision for (benefit from) deferred
income taxes
(1.7
)
(1.9
)
Other non-cash adjustments
1.4
1.2
Cash provided by (used in) changes in
operating assets and liabilities:
Accounts receivable
(6.0
)
(63.1
)
Inventory
3.5
2.7
Prepaid expenses and other assets
(1.5
)
15.2
Content production assets
(19.9
)
(9.1
)
Accounts payable, accrued expenses and
other liabilities
(2.6
)
7.7
Deferred revenues
(3.8
)
(7.5
)
Net cash provided by operating
activities
152.4
79.4
INVESTING ACTIVITIES:
Purchases of property and equipment and
other assets
(68.9
)
(12.3
)
Purchases of short-term investments
(188.8
)
(132.6
)
Proceeds from sales and maturities of
investments
131.9
143.0
Purchase of investment securities
(0.1
)
(0.6
)
Net cash used in investing activities
(125.9
)
(2.5
)
FINANCING ACTIVITIES:
Repayment of debt
(0.2
)
(100.2
)
Repayment of finance leases
(6.9
)
(5.4
)
Dividends paid
(17.8
)
(18.3
)
Proceeds from tenant improvement
allowances
13.1
—
Taxes paid related to net settlement upon
vesting of equity awards
(0.6
)
(0.7
)
Proceeds from issuance of stock
1.2
2.0
Repurchase and retirement of common
stock
(40.0
)
(93.8
)
Net cash used in financing activities
(51.2
)
(216.4
)
NET DECREASE IN CASH AND CASH
EQUIVALENTS
(24.7
)
(139.5
)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD
134.8
462.1
CASH AND CASH EQUIVALENTS, END OF
PERIOD
$
110.1
$
322.6
NON-CASH INVESTING TRANSACTIONS:
Purchases of property and equipment
recorded in accounts payable and accrued expenses
$
28.2
$
3.0
Principal stockholder contributions
$
2.7
$
1.2
World Wrestling Entertainment,
Inc.
Supplemental Information –
Reconciliation of Adjusted Net Income
(In millions, except per share
data)
(Unaudited)
Three Months Ended June
30,
2022
2021
As Reported
Other Adjustments (1)
Adjusted
As Reported
Other Adjustments (1)
Adjusted
Operating income
$
69.3
$
1.7
$
71.0
$
46.3
$
8.1
$
54.4
Interest expense
4.7
—
4.7
8.5
—
8.5
Other expense, net
(0.2
)
—
(0.2
)
(0.1
)
—
(0.1
)
Income before taxes
64.4
1.7
66.1
37.7
8.1
45.8
Provision for income taxes
15.4
0.4
15.8
8.5
1.8
10.3
Net income
$
49.0
$
1.3
$
50.3
$
29.2
$
6.3
$
35.5
Earnings per share - diluted
$
0.58
$
0.01
$
0.59
$
0.34
$
0.07
$
0.42
Six Months Ended June
30,
2022
2021
As Reported
Other Adjustments (1)
Adjusted
As Reported
Other Adjustments (1)
Adjusted
Operating income
$
161.7
$
1.7
$
163.4
$
111.4
$
8.1
$
119.5
Interest expense
11.0
—
11.0
17.0
—
17.0
Other income, net
0.1
—
0.1
0.4
—
0.4
Income before taxes
150.8
1.7
152.5
94.8
8.1
102.9
Provision for income taxes
35.7
0.4
36.1
21.8
1.9
23.7
Net income
$
115.1
$
1.3
$
116.4
$
73.0
$
6.2
$
79.2
Earnings per share - diluted
$
1.35
$
0.01
$
1.36
$
0.85
$
0.07
$
(1)
During the three and six months ended June 30, 2022, the
Company’s consolidated pre-tax results included $1.7 million
associated with certain costs related to the investigation by the
Special Committee of independent members of the Board of Directors.
During the three and six months ended June 30, 2021, the Company’s
consolidated pre-tax results included the impact of $8.1 million in
severance expense primarily related to the combination of WWE’s
television, digital and studios teams into one organization for a
more unified content strategy and more streamlined content
production.
World Wrestling Entertainment,
Inc.
Supplemental Information –
Reconciliation of Adjusted OIBDA
(In millions, except per share
data)
(Unaudited)
Three Months Ended June 30,
2022
Operating Income
(Loss)
Depreciation &
Amortization
Stock Compensation
Other Adjustments (2)
Adjusted OIBDA
Media
$
78.4
$
3.6
$
8.7
$
—
$
90.7
Live Events
13.2
0.1
0.5
—
13.8
Consumer Products
15.9
—
0.6
—
16.5
Corporate
(38.2
)
5.8
1.2
1.7
(29.5
)
Total
$
69.3
$
9.5
$
11.0
$
1.7
$
91.5
Three Months Ended June 30,
2021
Operating Income
(Loss)
Depreciation &
Amortization
Stock Compensation (1)
Other Adjustments (2)
Adjusted OIBDA
Media
$
80.8
$
3.8
$
1.6
$
—
$
86.2
Live Events
0.9
—
0.2
—
1.1
Consumer Products
7.9
0.1
0.4
—
8.4
Corporate
(43.3
)
7.0
0.6
8.1
(27.6
)
Total
$
46.3
$
10.9
$
2.8
$
8.1
$
68.1
Six Months Ended June 30,
2022
Operating Income
(Loss)
Depreciation &
Amortization
Stock Compensation
Other Adjustments (2)
Adjusted OIBDA
Media
$
195.8
$
7.2
$
15.9
$
—
$
218.9
Live Events
15.2
0.1
1.3
—
16.6
Consumer Products
27.1
0.1
1.2
—
28.4
Corporate
(76.4
)
11.8
2.2
1.7
(60.7
)
Total
$
161.7
$
19.2
$
20.6
$
1.7
$
203.2
Six Months Ended June 30,
2021
Operating Income
(Loss)
Depreciation &
Amortization
Stock Compensation (1)
Other Adjustments (2)
Adjusted OIBDA
Media
$
177.9
$
7.5
$
7.4
$
—
$
192.8
Live Events
(3.6
)
—
0.4
—
(3.2
)
Consumer Products
14.1
0.1
0.9
—
15.1
Corporate
(77.0
)
14.1
2.1
8.1
(52.7
)
Total
$
111.4
$
21.7
$
10.8
$
8.1
$
152.0
(1)
Stock compensation expense during the three and six months ended
June 30, 2021 includes the impact of forfeitures arising from the
Company’s business restructuring.
(2)
During the three and six months ended June 30, 2022, the
Company’s consolidated pre-tax results included $1.7 million
associated with certain costs related to the investigation by the
Special Committee of independent members of the Board of Directors.
During the three and six months ended June 30, 2021, the Company’s
consolidated pre-tax results included the impact of $8.1 million in
severance expense primarily related to the combination of WWE’s
television, digital and studios teams into one organization for a
more unified content strategy and more streamlined content
production.
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 2022
Q2 2022 YTD
Q3 2022
FY 2022
Adjusted OIBDA
$
91.5
$
203.2
$70 - $80
$370 - $385
Depreciation & amortization (1)
(9.5
)
(19.2
)
—
—
Stock-based compensation (1)
(11.0
)
(20.6
)
—
—
Other operating income items (1)
(1.7
)
(1.7
)
—
—
Operating income (U.S. GAAP
Basis)
$
69.3
$
161.7
Not estimable
Not estimable
(1)
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, 2022 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,
2022
2021
2022
2021
Net cash provided by operating
activities
$
56.9
$
19.5
$
152.4
$
79.4
Less cash used for capital
expenditures:
Purchases of property and equipment and
other assets (1)
(47.4
)
(6.2
)
(68.9
)
(12.3
)
Free Cash Flow (1)
$
9.5
$
13.3
$
83.5
$
67.1
(1)
Purchases of property and
equipment and other assets includes $40.8 million and $2.7 million
of capital expenditures related to the Company’s new headquarter
facility for the three months ended June 30, 2022 and 2021,
respectively. Excluding the capital expenditures related to the
Company’s new headquarter facility, Free Cash Flow was $50.3
million and $16.0 million for the three months ended June 30, 2022
and 2021, respectively. Purchases of property and equipment
and other assets includes $53.9 million and $3.4 million of capital
expenditures related to the Company’s new headquarter facility for
the six months ended June 30, 2022 and 2021, respectively.
Excluding the capital expenditures related to the Company’s new
headquarter facility, Free Cash Flow was $137.4 million and $70.5
million for the six months ended June 30, 2022 and 2021,
respectively. The Company received $10.8 million and $13.1 million
related to tenant improvement allowances associated with
construction of its new headquarter facility for the three and six
months ended June 30, 2022, respectively. These tenant improvement
allowances are included as a component of Net Cash Used in
Financing Activities within our Consolidated Statements of Cash
Flows and therefore excluded from Free Cash Flow.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220816005351/en/
Investors: Seth Zaslow 203-352-1026
Media: Matthew Altman 203-352-1177
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