Live Nation Inc. and Ticketmaster Entertainment Inc., which plan to merge, said late Monday that costs related to the proposed $2.5 billion deal lowered each company’s third quarter profit.
The companies, awaiting a U.S. Justice Department ruling on their merger proposal, spent more than $14.3 million combined on legal fees and other merger expenses. British authorities last month come out against the deal and are expected to require the companies to sell divisions or make other concessions.
After the markets closed, Beverly Hills venue operator Live Nation reported net income $69 million (78 cents per share) compared with $138 million ($1.66) a year ago. Revenue rose 14 percent to $1.81 billion, with North American music events, its largest segment, up 7.7 percent; international revenue rose 21 percent.
Live Nation reported $7.8 billion in acquisition transaction expenses. Analysts surveyed by Thomson Reuters expected earnings of 80 cents per share on revenue of $1.62 billion.
“Our ability to generate strong attendance growth of 12 percent despite the worst economic climate in decades speaks to the strength of our concert platform and our ongoing focus on improving how we promote, price and distribute live music products to millions of fans globally,” said Live Nation CEO Michael Rapino in a statement.
Ticketmaster, the West Hollywood concert and artist promoter, reported net income of $13.1 million (22 cents) compared with $9.6 million (17 cents) a year ago. Revenue rose 3 percent to more than $348 million.
Ticketmaster's merger-related costs reduced its per-share earnings by 7 cents. Analysts had expected 25 cents before those costs.
To bring in cost-conscious concertgoers during the recession, the company launched promotions such as "No Service Fee Wednesdays," which helped sell more than 816,000 tickets at its North American venues so far this year.
“Paperless ticketing has been received enthusiastically. It’s working well and a growing number of accounts are embracing the technology,” Ticketmaster Chief Executive Irving Azoff said in a statement.
Live Nation shares earlier closed up 33 cents, or nearly 5 percent, to $7.32 on the New York Stock Exchange. Ticketmaster shares closed up 65 cents, or 6.5 percent, to $10.72 on the Nasdaq and were down 3.6 percent in after-hours trading.
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