Live Nation Entertainment Reports First Quarter 2010 Financial Results

- Merger integration efforts on track to achieve 2010 synergies of $40 million -

- Completed $1.45 billion refinancing, simplifying capital structure and improving liquidity -

LOS ANGELES, May 10 /PRNewswire-FirstCall/ -- Live Nation Entertainment (NYSE: LYV) today released financial results for the three months ended March 31, 2010.  On January 25, 2010, Live Nation completed its merger with Ticketmaster; consequently, first quarter 2010 results include the legacy Ticketmaster operations from the closing date through March 31, 2010.

(Logo:  http://www.newscom.com/cgi-bin/prnh/20081203/LAW048LOGO-b)

"During the first quarter, we moved forward with integrating our operations, streamlining our cost structure and strengthening our balance sheet," said Michael Rapino, President and Chief Executive Officer of Live Nation Entertainment.  "We remain on track in eliminating redundancies and driving a minimum of $40 million in merger synergies across our operations in 2010.  In addition, we believe that our recently closed debt refinancing will further improve our financial position by providing operating benefits through a simplified capital structure and substantially improved liquidity.  Our core concert and ticketing businesses are entering the busiest time of the year and show count and ticket sales globally remain on track to achieve our plan for 2010."

"Our current artist pipeline is strong and we are excited about the upcoming tour cycles for several of our key artists, including the Eagles, Christina Aguilera, John Mayer, Kings of Leon and Ke$ha," said Irving Azoff, Executive Chairman of Live Nation Entertainment.  "We have expanded our artist management operations by opening an office in London and adding new artist relationships including the Glee tour.  With the completion of the merger, we are focused on streamlining our combined merchandise businesses to drive profitability."

Key operating metrics related to the Live Nation business, as outlined below, include the legacy Ticketmaster operations from the date of the merger through March 31, 2010.

METRICS


(Unaudited; $ in millions except as noted)

Key Drivers                               Q1 2010    Q1 2009   Variance (Qtr)

CONCERTS

Talent Costs and Other Event Direct
Operating Expenses                        $327.8     $328.8    (0.3%)

Talent and Other Event Expenses as % of
Total Revenue                             80.3%      79.6%

Number of Live Rights (Concerts) (est.)   4,467      4,451     0.4%

Total Attendance (rounded, est.)          6,835,000  7,054,000 (3.1%)

Total Revenue per Attendee (whole $)      $59.71     $58.57    1.9%

E-COMMERCE

# of Tickets Sold on TM.com & LN.com
(rounded, est.)                           18,296,000 1,605,000 **

# of Average Monthly Unique Visitors
(rounded, est.)                           26,100,000 7,000,000 **

Online Advertising & Upsell Revenue       $11.5      $1.6      **

SPONSORSHIP

Number of Sponsors - as of period end
(est.)                                    375        304       23.4%

Sponsorship Revenue Recognized            $21.2      $19.2     10.4%

Average Sponsorship Revenue per Sponsor
(rounded, whole $)                        $57,000    $63,000   (9.5%)

TICKETING

Royalty & Other Direct Ticketing Expenses $103.1     $5.0      **

Royalty & Other Direct Ticketing Expenses
as % of Total Revenue                     49.4%      55.6%

# of Tickets Sold                         25,143,000 3,424,000 **

**Not meaningful






(Unaudited; $ in millions, tickets in thousands)

                                   First Quarter - 2010

                                   Gross Value of Ticket Volume Ticket Mix

Primary Ticketing Volume Trends by
Category (1)                       Tickets Sold   Total Tickets % of Total

Concerts                           $910           13,123        52%

Sports                             $215           4,804         19%

Arts & Theater                     $186           3,605         14%

Family                             $123           2,784         11%

Other (2)                          $71            827           4%

Total                              $1,505         25,143        100%

(1) The number and gross value of tickets sold are inclusive of primary
and secondary tickets.

(2) Other category includes tickets for: comedy shows; parking; audio and
facility tours; donations; lectures; and seminars.





Our results of operations, as outlined below, include the results of the legacy Ticketmaster operations from the date of the merger through March 31, 2010.


REPORTED FINANCIAL HIGHLIGHTS – 1st QUARTER

(Unaudited)

                                 Q1 2010   Q1 2009  Growth

                                 ($ in millions)

Revenue

Concerts                         $ 408.1   $ 413.2  (1.2%)

Artist Nation                    69.4      41.7     66.4%

Ticketing                        208.9     9.0      **

Sponsorship                      21.2      19.2     10.4%

E-Commerce                       18.1      1.8      **

Other & Eliminations             (2.7)     -        **

                                 $ 723.0   $ 484.9  49.1%

                                                             Margins

Adjusted Operating Income (Loss)                             Q1 2010 Q1 2009

Concerts                         $ (42.5)  $ (27.4) (55.1%)  (10.4%) (6.6%)

Artist Nation                    0.8       (0.9)    **       1.1%    (2.2%)

Ticketing                        45.8      (3.1)    **       21.9%   **

Sponsorship                      8.6       5.8      48.3%    40.6%   30.2%

E-Commerce                       7.7       (2.9)    **       42.5%   **

Other & Eliminations             0.2       0.2      -

Corporate                        (19.2)    (11.2)   **

                                 $ 1.4     $ (39.5) **       0.2%    (8.1%)



Operating Income (Loss)

Concerts                         $ (72.9)  $ (62.3) (17.0%)  (17.9%) (15.1%)

Artist Nation                    (8.4)     (4.2)    **       (12.1%) (10.0%)

Ticketing                        15.8      (5.9)    **       7.6%    **

Sponsorship                      8.4       5.7      47.4%    39.6%   29.7%

E-Commerce                       5.0       (4.5)    **       27.6%   **

Other & Eliminations             0.2       0.1      **

Corporate                        (33.0)    (13.4)   **

                                 $ (84.9)  $ (84.5) -        (11.7%) (17.4%)

Acquisition Expenses:

Concerts                         $ -       $ 0.1

Artist Nation                    0.2       -

Ticketing                        3.7       -

Sponsorship                      0.3       -

E-Commerce                       0.2       -

Other & Eliminations             -         -

Corporate                        14.2      3.7

                                 $ (103.5) $ (88.3) (17.2%)  (14.3%) (18.2%)



** percentages are not meaningful







The highlights of our financial information for the first quarter of 2010 as compared to the first quarter of 2009 are as follows:

Revenue change – Total increase of $238.1 million, primarily driven by:

    --  $243.9 million–Increase in Artist Nation, Ticketing and E-Commerce
        segments primarily driven by the incorporation of Ticketmaster results
        after the completion of the merger.
    --  $18.0 million – Foreign exchange movements, primarily in Concerts.
    --  ($21.8) million – Decline in Concerts driven by a decrease in the
        number of events and attendance for amphitheaters, arenas and clubs.


Adjusted Operating Income (Loss) change – Total increase of $40.9 million, primarily driven by:

    --  $53.2 million – Increase in Ticketing, Artist Nation, E-Commerce and
        Corporate primarily resulting from our merger with Ticketmaster.
    --  ($15.1) million – Decline in Concerts primarily related to a $13.4
        million allowance recorded related to collectibility concerns around
        certain artist advances and a slight decline in show results.


Operating Income (Loss) change – Total decrease of $15.2 million, primarily driven by:

    --  $40.9 million – Overall increase in Adjusted Operating Income (Loss)
        noted above.
    --  ($17.2) million – Increase in depreciation and amortization primarily
        driven by the incorporation of the Ticketmaster results after the
        completion of the merger.
    --  ($14.8) million – Acquisition expenses, primarily in Corporate and
        Ticketing. These costs are primarily related to severance expenses and
        transaction costs related to the Ticketmaster merger.
    --  ($4.8) million – Increased loss on sale of operating assets primarily
        due to the $4.5 million loss resulting from our sale of Paciolan in the
        first quarter of 2010.
    --  ($19.3) million – Increase in non-cash compensation expense primarily
        driven by equity awards exchanged and accelerated due to the
        Ticketmaster merger.


Other Information –

    --  We currently expect capital expenditures to be approximately $100.0
        million for 2010, with approximately half of that amount expected to be
        spent on maintenance capital projects.
    --  We have transitioned our Live Nation tickets in our owned and/or
        operated venues in North America from our ticketing platform back to the
        Ticketmaster Host platform.
    --  As of March 31, 2010, our cash and cash equivalents were $825.2 million
        and our total long-term debt was $1,526.8 million, including $117.0
        million outstanding on our revolving credit facility. Free cash as of
        March 31, 2010 was $162.6 million and free cash flow was ($36.3) million
        for the first quarter of 2010 as compared to ($57.6) million in 2009.
    --  For the three months ended March 31, 2010, maintenance capital
        expenditures were $7.3 million and capital expenditures for revenue
        generating projects were $4.7 million, a total of $12.0 million as
        compared to $12.6 million in 2009.


Live Nation Combined Financial Summary

In order to give comparable information, the results of operations below include the results of the legacy Ticketmaster operations from the date of the merger (January 25) through March 31 for each of 2010 and 2009.


COMBINED FINANCIAL HIGHLIGHTS – 1st QUARTER

(Unaudited)

                                 Q1 2010   Q1 2009  Growth

                                 ($ in millions)

Revenue

Concerts                         $ 408.1   $ 413.2  (1.2%)

Artist Nation                    69.4      73.0     (4.9%)

Ticketing                        208.9     255.6    (18.3%)

Sponsorship                      21.2      19.2     10.4%

E-Commerce                       18.1      14.6     24.0%

Other & Eliminations             (2.7)     -        **

                                 $ 723.0   $ 775.6  (6.8%)

                                                             Margins

Adjusted Operating Income (Loss)                             Q1 2010 Q1 2009

Concerts                         $ (42.5)  $ (27.4) (55.1%)  (10.4%) (6.6%)

Artist Nation                    0.8       2.2      (63.6%)  1.1%    3.0%

Ticketing                        45.8      46.8     (2.1%)   21.9%   18.3%

Sponsorship                      8.6       5.8      48.3%    40.6%   30.2%

E-Commerce                       7.7       6.0      28.3%    42.5%   41.1%

Other & Eliminations             0.2       0.2      -

Corporate                        (19.2)    (24.4)   21.3%

                                 $ 1.4     $ 9.2    (84.8%)  0.2%    1.2%



Operating Income (Loss)

Concerts                         $ (72.9)  $ (62.3) (17.0%)  (17.9%) (15.1%)

Artist Nation                    (8.4)     (10.5)   20.0%    (12.1%) (14.4%)

Ticketing                        15.8      28.9     (45.3%)  7.6%    11.3%

Sponsorship                      8.4       5.7      47.4%    39.6%   29.7%

E-Commerce                       5.0       3.9      28.2%    27.6%   26.7%

Other & Eliminations             0.2       0.1      **

Corporate                        (33.0)    (27.8)   (18.7%)

                                 $ (84.9)  $ (62.0) (36.8%)  (11.7%) (8.0%)

Acquisition Expenses:

Concerts                         $ -       $ 0.1

Artist Nation                    0.2       -

Ticketing                        3.7       -

Sponsorship                      0.3       -

E-Commerce                       0.2       -

Other & Eliminations             -         -

Corporate                        14.2      4.9

                                 $ (103.5) $ (67.0) (54.5%)  (14.3%) (8.6%)



** percentages are not meaningful







Live Nation Combined Metrics

In order to give comparable information, selected metrics below include the results of the legacy Ticketmaster operations from the date of the merger (January 25) through March 31 for each of 2010 and 2009.


METRICS

(Unaudited; $ in millions except as noted)

Key Drivers                               Q1 2010    Q1 2009    Variance (Qtr)

TICKETING

Royalty & Other Direct Ticketing Expenses $103.1     $137.6     (25.1%)

Royalty & Other Direct Ticketing Expenses
as % of Total Revenue                     49.3%      53.8%

# of Tickets Sold                         25,143,000 29,931,000 (16.0%)








(Unaudited; $ in millions, tickets in thousands)

                                   First Quarter - 2009

                                   Gross Value of Ticket Volume Ticket Mix

Primary Ticketing Volume Trends by
Category (1)                       Tickets Sold   Total Tickets % of Total

Concerts                           $1,240         17,127        57%

Sports                             $215           5,114         17%

Arts & Theater                     $207           4,174         14%

Family                             $113           2,714         9%

Other (2)                          $81            801           3%

Total                              $1,856         29,930        100%

(1) The number and gross value of tickets sold are inclusive of primary
and secondary tickets.

(2) Other category includes tickets for: comedy shows; parking; audio and
facility tours; donations; lectures; and seminars.





Conference Call:

The company will host a teleconference today, May 10, 2010 at 5:00 p.m. Eastern Time, which can be accessed by dialing 888-603-6873 (U.S.) or 973-321-1019 (Int'l) and referencing passcode 63943468.  To access the call via webcast, please visit the Investor Relations section of the company's website at www.livenation.com/investors.  Please visit the website approximately ten minutes prior to start time to ensure a connection.  Additional statistical and financial information to be provided on the call, if any, will be posted supplementally under that same link.  For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the Live Nation website through May 17, 2010.  

About Live Nation Entertainment:

Live Nation Entertainment (NYSE:LYV) is the largest live entertainment company in the world, consisting of five businesses: concert promotion and venue operations, sponsorship, ticketing solutions, e-commerce and artist management.  Live Nation seeks to innovate and enhance the live entertainment experience for artists and fans: before, during and after the show.  In 2009, Live Nation sold 140 million tickets, promoted 21,000 concerts, partnered with 850 sponsors and averaged 25 million unique monthly users of its e-commerce sites.  For additional information, visit www.livenation.com/investors.  


CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)



                                 Three Months Ended
                                 March 31 ,

                                 2010        2009

                                 (in thousands except share and per share data)

Revenue                          $ 722,953   $ 484,912

Operating expenses:

Direct operating expenses        485,153     373,060

Selling, general and
administrative expenses          231,271     140,902

Depreciation and amortization    59,319      42,083

Loss (gain) on sale of operating
assets                           4,571       (264)

Corporate expenses               37,124      13,532

Acquisition transaction expenses 9,017       3,858



Operating loss                   (103,502)   (88,259)

Interest expense                 26,505      17,255

Interest income                  (674)       (990)

Equity in earnings of
nonconsolidated affiliates       (547)       (183)

Other expense (income) — net   (1,068)     1,694



Loss from continuing operations
before income taxes              (127,718)   (106,035)

Income tax expense (benefit):

Current                          (1,842)     1,699

Deferred                         (13,488)    (1,613)



Loss from continuing operations  (112,388)   (106,121)

Income (loss) from discontinued
operations, net of tax           (303)       2,964



Net loss                         (112,691)   (103,157)

Net loss attributable to
noncontrolling interests         (738)       (450)



Net loss attributable to Live
Nation Entertainment, Inc.       $ (111,953) $ (102,707)



Basic and diluted net income
(loss) per common share
attributable to common
stockholders:

Loss from continuing operations
attributable to Live Nation
Entertainment, Inc.              $ (0.76)    $ (1.33)

Income (loss) from discontinued
operations attributable to Live
Nation Entertainment, Inc.       -           0.04



Net loss attributable to Live
Nation Entertainment, Inc.       $ (0.76)    $ (1.29)



Weighted average common shares
outstanding:

Basic and diluted                146,300,907 79,601,562










CONSOLIDATED BALANCE SHEETS (UNAUDITED)



                                                    March 31,   December 31,

                                                    2010        2009

                                                    (unaudited) (audited)

                                                    (in thousands)

ASSETS

CURRENT ASSETS

Cash and cash equivalents                           $ 825,197   $ 236,955

Accounts receivable, less allowance of $8,511 as of
March 31, 2010 and $8,230 as of December 31, 2009   263,952     176,179

Prepaid expenses                                    468,557     277,599

Other current assets                                51,395      27,133

Total current assets                                1,609,101   717,866

PROPERTY, PLANT AND EQUIPMENT

Land, buildings and improvements                    875,035     875,958

Computer equipment and capitalized software         177,085     131,875

Furniture and other equipment                       165,409     156,756

Construction in progress                            26,810      17,398



                                                    1,244,339   1,181,987

Less accumulated depreciation                       459,247     432,003



                                                    785,092     749,984

INTANGIBLE ASSETS

Definite-lived intangible assets — net            952,118     442,641

Indefinite-lived intangible assets                  381,991     28,248

Goodwill                                            1,169,785   204,672

OTHER LONG-TERM ASSETS

Investments in nonconsolidated affiliates           27,446      2,077

Other long-term assets                              211,905     196,271



Total assets                                        $ 5,137,438 $ 2,341,759



LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

Accounts payable, client accounts                   $ 390,427   $ —

Accounts payable                                    80,330      50,844

Accrued expenses                                    407,482     357,138

Deferred revenue                                    598,574     284,536

Current portion of long-term debt                   39,203      41,032

Other current liabilities                           49,997      18,684



Total current liabilities                           1,566,013   752,234



Long-term debt, net                                 1,487,575   699,037

Long-term deferred income taxes                     224,797     30,480

Other long-term liabilities                         165,456     94,567

Series A and Series B redeemable preferred stock    40,000      40,000

Commitments and contingent liabilities



Redeemable noncontrolling interests                 119,409     —



STOCKHOLDERS' EQUITY

Common stock                                        1,717       860

Additional paid-in capital                          2,028,162   1,090,572

Accumulated deficit                                 (545,738)   (433,785 )

Cost of shares held in treasury                     (9,962)     (9,529 )

Accumulated other comprehensive income (loss)       (40,037)    4,199



Total Live Nation Entertainment, Inc. stockholders'
equity                                              1,434,142   652,317

Noncontrolling interests                            100,046     73,124

Total stockholders' equity                          1,534,188   725,441

Total liabilities and stockholders' equity          $ 5,137,438 $ 2,341,759










CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)





                                                        Three Months Ended

                                                        March 31,

                                                        2010        2009



CASH FLOWS FROM OPERATING ACTIVITIES

Net loss                                                $ (112,691) $ (103,157)

Reconciling items:

Depreciation                                            30,971      29,100

Amortization of intangible assets                       28,348      14,313

Deferred income tax benefit                             (13,488)    (1,146)

Amortization of debt issuance costs                     783         855

Amortization of debt discount/premium, net              2,037       2,123

Non-cash compensation expense                           22,422      3,076

Loss (gain) on sale of operating assets                 4,874       (268)

Equity in earnings of nonconsolidated affiliates        (547)       (575)

Changes in operating assets and liabilities, net of
effects of acquisitions and dispositions:

Decrease (increase) in accounts receivable              45,428      (16,126)

Increase in prepaid expenses                            (150,772)   (188,693)

Increase in other assets                                (162)       (20,172)

Decrease in accounts payable, client accounts           (639)       -

Increase (decrease) in accounts payable, accrued        (60,255)    8,447
expenses and other liabilities

Increase in deferred revenue                            293,192     474,160



Net cash provided by operating activities               89,501      201,937



CASH FLOWS FROM INVESTING ACTIVITIES

Collections of notes receivable                         19          117

Advances to notes receivable                            -           (111)

Distributions from nonconsolidated affiliates           836         1,245

Investments made in nonconsolidated affiliates          -           (15)

Purchases of property, plant and equipment              (13,083)    (23,962)

Proceeds from disposal of operating assets, net of cash 20,643      12,926
divested

Cash paid for acquisitions, net of cash acquired        569,210     (2,660)

Purchases of intangible assets                          (7,201)     (860)

Decrease in other—net                                 412         117



Net cash provided by (used in) investing activities     570,836     (13,203)



CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from long-term debt, net of debt issuance      147,303     153,367
costs

Payments on long-term debt                              (193,321)   (176,037)

Contributions from noncontrolling interest partners     8           -

Distributions to noncontrolling interest partners       (6,687)     (42)

Proceeds from exercise of stock options                 2,163       -

Issuance of treasury stock                              -           1,553

Equity issuance costs                                   (40)        -

Payments for purchases of common stock                  (1,567)     (5,803)



Net cash used in financing activities                   (52,141)    (26,962)

Effect of exchange rate changes on cash and cash        (19,954)    (4,328)
equivalents



Net increase in cash and cash equivalents               588,242     157,444

Cash and cash equivalents at beginning of period        236,955     199,660



Cash and cash equivalents at end of period              $ 825,197   $ 357,104









Forward-Looking Statements, Non-GAAP Financial Measures and Reconciliations:

Certain statements in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements include, but are not limited to, statements regarding the potential health and growth of Live Nation's business, including with respect to its current artist pipeline and the upcoming summer concert season; the company's anticipated achievement of its strategic objectives; the company's ability to achieve its targeted synergies and realize other anticipated benefits associated with its merger with Ticketmaster; the company's anticipated improvements to its financial position and liquidity as a result of its recent refinancing; the company's planned capital expenditures; and the company's expected show count and ticket sales.  Live Nation wishes to caution you that there are some known and unknown factors that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements, including but not limited to operational challenges in achieving strategic objectives and executing on the company's plans, the risk that the company's markets do not evolve as anticipated, challenges related to the post-merger integration of Live Nation and Ticketmaster, the potential impact of the economic slowdown and operational challenges associated with selling tickets and staging events.

Live Nation refers you to the documents it files from time to time with the U.S. Securities and Exchange Commission, or SEC, specifically the section titled "Item 1A. Risk Factors" of the company's most recent Annual Report filed on Form 10-K and Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K, which contain and identify other important factors that could cause actual results to differ materially from those contained in the company's projections or forward-looking statements.  You are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date on which they are made.  All subsequent written and oral forward-looking statements by or concerning Live Nation are expressly qualified in their entirety by the cautionary statements above.  Live Nation does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise.

This press release contains certain non-GAAP financial measures as defined by SEC Regulation G.  A reconciliation of each such measure to its most directly comparable GAAP financial measure, together with an explanation of why management believes that these non-GAAP financial measures provide useful information to investors, is provided below.

Adjusted Operating Income (Loss), or AOI, is a non-GAAP financial measure that the company defines as operating income (loss) before acquisition expenses (including merger bonuses, payments under the Azoff Trust note and merger-related severance), depreciation and amortization (including goodwill impairment), loss (gain) on sale of operating assets and non-cash compensation expense.  The company uses AOI to evaluate the performance of its operating segments.  The company believes that information about AOI assists investors by allowing them to evaluate changes in the operating results of the company's portfolio of businesses separate from non-operational factors that affect net income, thus providing insights into both operations and the other factors that affect reported results.  AOI is not calculated or presented in accordance with GAAP.  A limitation of the use of AOI as a performance measure is that it does not reflect the periodic costs of certain amortizing assets used in generating revenue in the company's business.  Accordingly, AOI should be considered in addition to, and not as a substitute for, operating income (loss), net income (loss) and other measures of financial performance reported in accordance with GAAP.  Furthermore, this measure may vary among other companies; thus, AOI as presented herein may not be comparable to similarly titled measures of other companies.

Free Cash Flow is a non-GAAP financial measure that the company defines as Adjusted Operating Income (Loss) less maintenance capital expenditures, less net cash interest expense, less cash taxes, less net distributions to minority interest partners, plus distributions from investments in nonconsolidated affiliates net of contributions to investments in nonconsolidated affiliates.  The company uses free cash flow, among other measures, to evaluate the ability of its operations to generate cash that is available for purposes other than maintenance capital expenditures.  The company believes that information about free cash flow provides investors with an important perspective on the cash available to service debt and make acquisitions.  Free cash flow is not calculated or presented in accordance with GAAP.  A limitation of the use of free cash flow as a performance measure is that it does not necessarily represent funds available for operations and is not necessarily a measure of our ability to fund our cash needs.  Accordingly, free cash flow should be considered in addition to, and not as a substitute for, operating income (loss) and other measures of financial performance reported in accordance with GAAP.  Furthermore, this measure may vary among other companies; thus, free cash flow as presented herein may not be comparable to similarly titled measures of other companies.

Free Cash is a non-GAAP financial measure that the company defines as cash and cash equivalents less ticketing-related client funds, less event-related deferred revenue, less accrued expenses due to artists and for cash collected on behalf of others for ticket sales, plus event-related prepaids.  The company uses free cash as a proxy for how much cash it has available to, among other things, optionally repay debt balances, make acquisitions and finance venue and other revenue generating expenditures. Free cash is not calculated or presented in accordance with GAAP.  A limitation of the use of free cash as a performance measure is that it does not necessarily represent funds available for operations and it is not necessarily a measure of our ability to fund our cash needs.  Accordingly, free cash should be considered in addition to, and not as a substitute for, cash and cash equivalents and other measures of financial performance reported in accordance with GAAP.  Furthermore, this measure may vary among other companies; thus, free cash as presented herein may not be comparable to similarly titled measures of other companies.



Reconciliations of Non-GAAP Measures to Their Most Directly Comparable GAAP
Measures (Unaudited)



Reconciliation of Adjusted Operating Income (Loss) to Operating Income (Loss) –
First Quarter



                                     Loss
              Adjusted               (gain) on
              operating Non-cash     sale of               Depreciation Operating
($ in         income    compensation operating Acquisition and          income
millions)     (loss)    expense      assets    expenses    amortization (loss)



              Three months ended March 31, 2010



Concerts      $ (42.5)  $ 2.0        $ -       $ -         $ 28.4       $ (72.9)

Artist
Nation        0.8       1.3          -         0.2         7.9          (8.6)

Ticketing     45.8      5.9          4.6       3.7         19.5         12.1

Sponsorship   8.6       0.1          -         0.3         0.1          8.1

E-Commerce    7.7       -            -         0.2         2.7          4.8

Other &
Eliminations  0.2       -            -         -           -            0.2

Corporate     (19.2)    13.1         -         14.2        0.7          (47.2)

Total Live
Nation        $ 1.4     $ 22.4       $ 4.6     $ 18.6      $ 59.3       $ (103.5)



              Three months ended March 31, 2009



Concerts      $ (27.4)  $ 0.7        $ (0.3)   $ 0.1       $ 34.5       $ (62.4)

Artist
Nation        (0.9)     0.3          -         -           3.0          (4.2)

Ticketing     (3.1)     -            -         -           2.8          (5.9)

Sponsorship   5.8       -            -         -           0.1          5.7

E-Commerce    (2.9)     0.2          -         -           1.4          (4.5)

Other &
Eliminations  0.2       -            -         -           0.1          0.1

Corporate     (11.2)    1.9          -         3.7         0.3          (17.1)

Total Live
Nation        $ (39.5)  $ 3.1        $ (0.3)   $ 3.8       $ 42.2       $ (88.3)








Reconciliation of Adjusted Operating Income (Loss) to Free Cash Flow
– First Quarter



($ in millions)                                      Q1 2010  Q1 2009

Adjusted operating income (loss)                     $ 1.4    $ (39.5)

Less: Cash interest expense — net                  (22.7)   (13.3)

Cash taxes                                           (1.8)    (3.0)

Maintenance capital expenditures                     (7.3)    (3.0)

Distributions to minority interest partners          (6.7)    (0.0)

Distributions from (contributions to) investments in
nonconsolidated affiliates                           0.8      1.2

Free cash flow                                       $ (36.3) $ (57.6)








Reconciliation of Cash and Cash Equivalents to Free Cash



                                               March 31,
($ in millions)                                2010

Cash and cash equivalents                      $ 825.2

Deferred revenue                               (556.1)

Accrued artist fees                            (11.6)

Collections on behalf of others                (46.5)

Client cash                                    (342.9)

Prepaids related to artist settlements/events  294.5

Free cash                                      $ 162.6









Reconciliation of Adjusted Operating Income (Loss) to Operating Income (Loss) –
First Quarter



Live Nation Combined



                                     Loss
              Adjusted               (gain) on
              operating Non-cash     sale of               Depreciation Operating
($ in         income    compensation operating Acquisition and          income
millions)     (loss)    expense      assets    expenses    amortization (loss)



              Three months ended March 31, 2009



Concerts      $ (27.4)  $ 0.7        $ (0.3)   $ 0.1       $ 34.5       $ (62.4)

Artist
Nation        2.2       3.4          -         -           9.3          (10.5)

Ticketing     46.8      1.5          -         -           16.4         28.9

Sponsorship   5.8       -            -         -           0.1          5.7

E-Commerce    6.0       0.2          -         -           1.9          3.9

Other &
Eliminations  0.2       -            -         -           0.1          0.1

Corporate     (24.4)    3.1          -         4.9         0.3          (32.7)

Total Live
Nation        $ 9.2     $ 8.9        $ (0.3)   $ 5.0       $ 62.6       $ (67.0)







SOURCE Live Nation Entertainment