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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________
Form 10-Q
____________________________________ | | | | | |
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2023
or | | | | | |
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number 001-32601
____________________________________
LIVE NATION ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
____________________________________ | | | | | | | | |
| Delaware | | 20-3247759 |
| (State of Incorporation) | | (I.R.S. Employer Identification No.) |
9348 Civic Center Drive
Beverly Hills, CA 90210
(Address of principal executive offices, including zip code)
(310) 867-7000
(Registrant’s telephone number, including area code)
______________________________________________________________ | | | | | | | | | | | | | | |
| Securities registered pursuant to Section 12(b) of the Act: |
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common stock, $.01 Par Value Per Share | | LYV | | New York Stock Exchange |
| | | | |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. | | | | | | | | | | | | | | | | | |
| Large Accelerated Filer | x | | Accelerated Filer | | ¨ |
| | | | | |
| Non-accelerated Filer | ¨ | | Smaller Reporting Company | | ☐ |
| | | Emerging Growth Company | | ☐ |
| If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | | ¨ |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes x No
On October 26, 2023, there were 230,325,360 outstanding shares of the registrant’s common stock, $0.01 par value per share, including 1,475,979 shares of unvested restricted stock awards and excluding 408,024 shares held in treasury.
LIVE NATION ENTERTAINMENT, INC.
INDEX TO FORM 10-Q
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| PART I—FINANCIAL INFORMATION | |
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| PART II—OTHER INFORMATION | |
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| GLOSSARY OF KEY TERMS |
| AOCI | Accumulated other comprehensive income (loss) |
| AOI | Adjusted operating income (loss) |
| |
| |
| |
| |
| |
| FASB | Financial Accounting Standards Board |
| GAAP | United States Generally Accepted Accounting Principles |
| |
| GTV | Gross transaction value |
| LIBOR | London Inter-Bank Offered Rate |
| Live Nation | Live Nation Entertainment, Inc. and subsidiaries |
| LNE | Live Nation Entertainment, Inc. |
| SEC | United States Securities and Exchange Commission |
| SOFR | Secured Overnight Financing Rate |
| Ticketmaster | Our ticketing business |
| VIE | Variable interest entities (as defined under GAAP) |
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED) | | | | | | | | | | | |
| September 30,
2023 | | December 31,
2022 |
| (in thousands) |
| ASSETS | | | |
| Current assets | | | |
| Cash and cash equivalents | $ | 5,948,511 | | | $ | 5,606,457 | |
Accounts receivable, less allowance of $71,553 and $63,294, respectively | 2,503,135 | | | 1,465,383 | |
| Prepaid expenses | 1,424,561 | | | 949,826 | |
| Restricted cash | 6,851 | | | 5,917 | |
| Other current assets | 123,620 | | | 131,939 | |
| Total current assets | 10,006,678 | | | 8,159,522 | |
| Property, plant and equipment, net | 1,955,906 | | | 1,487,663 | |
| Operating lease assets | 1,594,093 | | | 1,571,395 | |
| Intangible assets | | | |
| Definite-lived intangible assets, net | 1,123,151 | | | 1,050,622 | |
| Indefinite-lived intangible assets, net | 376,964 | | | 368,712 | |
| Goodwill | 2,653,526 | | | 2,529,380 | |
| Long-term advances | 510,633 | | | 568,558 | |
| Other long-term assets | 919,622 | | | 724,989 | |
| Total assets | $ | 19,140,573 | | | $ | 16,460,841 | |
| LIABILITIES AND EQUITY | | | |
| Current liabilities | | | |
| Accounts payable, client accounts | $ | 1,742,004 | | | $ | 1,791,025 | |
| Accounts payable | 276,982 | | | 180,076 | |
| Accrued expenses | 3,315,483 | | | 2,368,434 | |
| Deferred revenue | 3,083,668 | | | 3,134,800 | |
| Current portion of long-term debt, net | 50,609 | | | 620,032 | |
| Current portion of operating lease liabilities | 150,304 | | | 140,232 | |
| Other current liabilities | 132,471 | | | 68,716 | |
| Total current liabilities | 8,751,521 | | | 8,303,315 | |
| Long-term debt, net | 6,546,061 | | | 5,283,467 | |
| Long-term operating lease liabilities | 1,673,750 | | | 1,654,525 | |
| | | |
| Other long-term liabilities | 468,504 | | | 455,971 | |
| Commitments and contingent liabilities | | | |
| Redeemable noncontrolling interests | 835,768 | | | 669,766 | |
| Stockholders' equity | | | |
| Common stock | 2,293 | | | 2,285 | |
| Additional paid-in capital | 2,411,302 | | | 2,698,316 | |
| Accumulated deficit | (2,197,221) | | | (2,971,229) | |
| Cost of shares held in treasury | (6,865) | | | (6,865) | |
| Accumulated other comprehensive income (loss) | 12,242 | | | (90,076) | |
| Total Live Nation stockholders' equity | 221,751 | | | (367,569) | |
| Noncontrolling interests | 643,218 | | | 461,366 | |
| Total equity | 864,969 | | | 93,797 | |
| Total liabilities and equity | $ | 19,140,573 | | | $ | 16,460,841 | |
See Notes to Consolidated Financial Statements
2
LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended
September 30, | | Nine Months Ended
September 30, | |
| | 2023 | | 2022 | | 2023 | | 2022 | |
| | (in thousands except share and per share data) | |
| Revenue | $ | 8,152,019 | | | $ | 6,153,535 | | | $ | 16,910,132 | | | $ | 12,390,517 | | |
| Operating expenses: | | | | | | | | |
| Direct operating expenses | 6,330,465 | | | 4,707,848 | | | 12,610,832 | | | 9,045,893 | | |
| Selling, general and administrative expenses | 974,150 | | | 805,910 | | | 2,533,066 | | | 2,048,305 | | |
| Depreciation and amortization | 130,653 | | | 102,093 | | | 382,352 | | | 318,489 | | |
| Gain on disposal of operating assets | (1,583) | | | (35,285) | | | (8,092) | | | (32,555) | | |
| Corporate expenses | 99,802 | | | 66,720 | | | 244,295 | | | 158,377 | | |
| Operating income | 618,532 | | | 506,249 | | | 1,147,679 | | | 852,008 | | |
| Interest expense | 86,215 | | | 70,514 | | | 257,425 | | | 205,722 | | |
| Loss on extinguishment of debt | — | | | — | | | 18,366 | | | — | | |
| Interest income | (78,107) | | | (25,809) | | | (174,872) | | | (46,565) | | |
| Equity in losses (earnings) of nonconsolidated affiliates | (5,382) | | | 14,283 | | | (15,047) | | | 8,040 | | |
| | | | | | | | |
| Other expense, net | 19,251 | | | 7,960 | | | 24,235 | | | 22,398 | | |
| Income before income taxes | 596,555 | | | 439,301 | | | 1,037,572 | | | 662,413 | | |
| Income tax expense | 55,874 | | | 41,898 | | | 121,362 | | | 85,589 | | |
| Net income | 540,681 | | | 397,403 | | | 916,210 | | | 576,824 | | |
| Net income attributable to noncontrolling interests | 57,186 | | | 36,001 | | | 142,202 | | | 77,804 | | |
| Net income attributable to common stockholders of Live Nation | $ | 483,495 | | | $ | 361,402 | | | $ | 774,008 | | | $ | 499,020 | | |
| | | | | | | | |
| Basic net income per common share available to common stockholders of Live Nation | $ | 1.85 | | | $ | 1.47 | | | $ | 2.63 | | | $ | 1.79 | | |
| Diluted net income per common share available to common stockholders of Live Nation | $ | 1.78 | | | $ | 1.39 | | | $ | 2.59 | | | $ | 1.73 | | |
| | | | | | | | |
| Weighted average common shares outstanding: | | | | | | | | |
| Basic | 228,787,263 | | | 225,761,777 | | | 228,497,712 | | | 224,123,130 | | |
| Diluted | 244,163,678 | | | 243,686,803 | | | 235,146,395 | | | 239,617,920 | | |
| | | | | | | | |
| | | | | | | | |
Reconciliation to net income available to common stockholders of Live Nation: | | | | | |
| Net income attributable to common stockholders of Live Nation | $ | 483,495 | | | $ | 361,402 | | | $ | 774,008 | | | $ | 499,020 | | |
| Accretion of redeemable noncontrolling interests | (60,882) | | | (29,915) | | | (172,436) | | | (97,723) | | |
Net income available to common stockholders of Live Nation—basic | $ | 422,613 | | | $ | 331,487 | | | $ | 601,572 | | | $ | 401,297 | | |
| Convertible debt interest, net of tax | 10,877 | | | 6,365 | | | 7,835 | | | 12,124 | | |
Net income available to common stockholders of Live Nation—diluted | $ | 433,490 | | | $ | 337,852 | | | $ | 609,407 | | | $ | 413,421 | | |
| | | | | | | | |
See Notes to Consolidated Financial Statements
3
LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended
September 30, | | Nine Months Ended
September 30, |
| | 2023 | | 2022 | | 2023 | | 2022 |
| | (in thousands) |
| Net income | $ | 540,681 | | | $ | 397,403 | | | $ | 916,210 | | | $ | 576,824 | |
| Other comprehensive income, net of tax: | | | | | | | |
| Unrealized gain on cash flow hedge | 6,293 | | | 18,522 | | | 14,002 | | | 50,178 | |
| Realized loss (gain) on cash flow hedge | (4,632) | | | (515) | | | (12,436) | | | 2,634 | |
| Foreign currency translation adjustments | (48,672) | | | (42,319) | | | 100,752 | | | (58,731) | |
| Comprehensive income | 493,670 | | | 373,091 | | | 1,018,528 | | | 570,905 | |
Comprehensive income attributable to noncontrolling interests | 57,186 | | | 36,001 | | | 142,202 | | | 77,804 | |
Comprehensive income attributable to common stockholders of Live Nation | $ | 436,484 | | | $ | 337,090 | | | $ | 876,326 | | | $ | 493,101 | |
See Notes to Consolidated Financial Statements
4
LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Live Nation Stockholders’ Equity | | | | | | |
| | Common Shares Issued | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Cost of Shares Held in Treasury | | Accumulated Other Comprehensive Income | | Noncontrolling Interests | | Total Equity | | Redeemable Noncontrolling Interests |
| | (in thousands, except share data) | | (in thousands) |
| Balances at June 30, 2023 | | 229,084,194 | | | $ | 2,291 | | | $ | 2,438,660 | | | $ | (2,680,716) | | | $ | (6,865) | | | $ | 59,253 | | | $ | 558,806 | | | $ | 371,429 | | | $ | 753,519 | |
| | | | | | | | | | | | | | | | | | |
| Non-cash and stock-based compensation | | 58 | | | — | | | 26,537 | | | — | | | — | | | — | | | — | | | 26,537 | | | — | |
| Common stock issued under stock plans, net of shares withheld for employee taxes | | 11,905 | | | — | | | (537) | | | — | | | — | | | — | | | — | | | (537) | | | — | |
| Exercise of stock options | | 161,225 | | | 2 | | | 3,342 | | | — | | | — | | | — | | | — | | | 3,344 | | | — | |
| | | | | | | | | | | | | | | | | | |
| Acquisitions | | — | | | — | | | — | | | — | | | — | | | — | | | 49,387 | | | 49,387 | | | 20,411 | |
| | | | | | | | | | | | | | | | | | |
| Purchases of noncontrolling interests | | — | | | — | | | 3,927 | | | — | | | — | | | — | | | — | | | 3,927 | | | (5,498) | |
| | | | | | | | | | | | | | | | | | |
| Redeemable noncontrolling interests fair value adjustments | | — | | | — | | | (60,627) | | | — | | | — | | | — | | | — | | | (60,627) | | | 60,627 | |
| Contributions received | | — | | | — | | | — | | | — | | | — | | | — | | | 772 | | | 772 | | | — | |
| Cash distributions | | — | | | — | | | — | | | — | | | — | | | — | | | (13,489) | | | (13,489) | | | (2,691) | |
| Other | | — | | | — | | | — | | | — | | | — | | | — | | | 2,164 | | | 2,164 | | | (2,208) | |
| Comprehensive income (loss): | | | | | | | | | | | | | | | | | | |
| Net income | | — | | | — | | | — | | | 483,495 | | | — | | | — | | | 45,578 | | | 529,073 | | | 11,608 | |
| Unrealized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | 6,293 | | | — | | | 6,293 | | | — | |
| Realized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | (4,632) | | | — | | | (4,632) | | | — | |
| Foreign currency translation adjustments | | — | | | — | | | — | | | — | | | — | | | (48,672) | | | — | | | (48,672) | | | — | |
| Balances at September 30, 2023 | | 229,257,382 | | | $ | 2,293 | | | $ | 2,411,302 | | | $ | (2,197,221) | | | $ | (6,865) | | | $ | 12,242 | | | $ | 643,218 | | | $ | 864,969 | | | $ | 835,768 | |
See Notes to Consolidated Financial Statements
5
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Live Nation Stockholders’ Equity | | | | | | |
| | Common Shares Issued | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Cost of Shares Held in Treasury | | Accumulated Other Comprehensive Income (Loss) | | Noncontrolling Interests | | Total Equity | | Redeemable Noncontrolling Interests |
| | (in thousands, except share data) | | (in thousands) |
| Balances at December 31, 2022 | | 228,498,102 | | | $ | 2,285 | | | $ | 2,698,316 | | | $ | (2,971,229) | | | $ | (6,865) | | | $ | (90,076) | | | $ | 461,366 | | | $ | 93,797 | | | $ | 669,766 | |
| | | | | | | | | | | | | | | | | | |
| Non-cash and stock-based compensation | | 58 | | | — | | | 81,871 | | | — | | | — | | | — | | | — | | | 81,871 | | | — | |
| Common stock issued under stock plans, net of shares withheld for employee taxes | | 229,406 | | | 2 | | | (9,003) | | | — | | | — | | | — | | | — | | | (9,001) | | | — | |
| Exercise of stock options | | 373,066 | | | 4 | | | 8,339 | | | — | | | — | | | — | | | — | | | 8,343 | | | — | |
| Repurchase of 2.5% convertible senior notes due 2023 | | 156,750 | | | 2 | | | (27,327) | | | — | | | — | | | — | | | — | | | (27,325) | | | — | |
| Capped call transactions for 3.125% convertible senior notes due 2029 | | — | | | — | | | (75,500) | | | — | | | — | | | — | | | — | | | (75,500) | | | — | |
| Acquisitions | | — | | | — | | | — | | | — | | | — | | | — | | | 116,630 | | | 116,630 | | | 46,707 | |
| | | | | | | | | | | | | | | | | | |
| Purchases of noncontrolling interests | | — | | | — | | | (93,721) | | | — | | | — | | | — | | | (27,090) | | | (120,811) | | | (4,839) | |
| | | | | | | | | | | | | | | | | | |
| Redeemable noncontrolling interests fair value adjustments | | — | | | — | | | (171,673) | | | — | | | — | | | — | | | — | | | (171,673) | | | 171,673 | |
| Contributions received | | — | | | — | | | — | | | — | | | — | | | — | | | 15,403 | | | 15,403 | | | 85 | |
| Cash distributions | | — | | | — | | | | | — | | | — | | | — | | | (88,182) | | | (88,182) | | | (65,607) | |
| Other | | — | | | — | | | — | | | — | | | — | | | — | | | 56,484 | | | 56,484 | | | (15,612) | |
| Comprehensive income (loss): | | | | | | | | | | | | | | | | | | |
| Net income | | — | | | — | | | — | | | 774,008 | | | — | | | — | | | 108,607 | | | 882,615 | | | 33,595 | |
| Unrealized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | 14,002 | | | — | | | 14,002 | | | — | |
| Realized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | (12,436) | | | — | | | (12,436) | | | — | |
| Foreign currency translation adjustments | | — | | | — | | | — | | | — | | | — | | | 100,752 | | | — | | | 100,752 | | | — | |
| Balance at September 30, 2023 | | 229,257,382 | | | $ | 2,293 | | | $ | 2,411,302 | | | $ | (2,197,221) | | | $ | (6,865) | | | $ | 12,242 | | | $ | 643,218 | | | $ | 864,969 | | | $ | 835,768 | |
See Notes to Consolidated Financial Statements
6
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Live Nation Stockholders’ Equity | | | | | | |
| | Common Shares Issued | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Cost of Shares Held in Treasury | | Accumulated Other Comprehensive Loss | | Noncontrolling Interests | | Total Equity | | Redeemable Noncontrolling Interests |
| | (in thousands, except share data) | | (in thousands) |
| Balances at June 30, 2022 | | 225,581,279 | | | $ | 2,256 | | | $ | 2,853,613 | | | $ | (3,129,597) | | | $ | (6,865) | | | $ | (129,571) | | | $ | 445,162 | | | $ | 34,998 | | | $ | 565,024 | |
| Non-cash and stock-based compensation | | — | | | — | | | 23,929 | | | — | | | — | | | — | | | — | | | 23,929 | | | — | |
| Common stock issued under stock plans, net of shares withheld for employee taxes | | 519,012 | | | 5 | | | (5,227) | | | — | | | — | | | — | | | — | | | (5,222) | | | — | |
| Exercise of stock options | | 1,037,290 | | | 10 | | | 9,637 | | | — | | | — | | | — | | | — | | | 9,647 | | | — | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| Acquisitions | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 9,729 | |
| | | | | | | | | | | | | | | | | | |
| Purchases of noncontrolling interests | | — | | | — | | | (2,405) | | | — | | | — | | | — | | | 19 | | | (2,386) | | | — | |
| Redeemable noncontrolling interests fair value adjustments | | — | | | — | | | (29,840) | | | — | | | — | | | — | | | — | | | (29,840) | | | 30,140 | |
| Contributions received | | — | | | — | | | — | | | — | | | — | | | — | | | 1,317 | | | 1,317 | | | — | |
| Cash distributions | | — | | | — | | | — | | | — | | | — | | | — | | | (14,712) | | | (14,712) | | | (1,026) | |
| Other | | — | | | — | | | 2,405 | | | — | | | — | | | — | | | 775 | | | 3,180 | | | (181) | |
| Comprehensive income (loss): | | | | | | | | | | | | | | | | | | |
| Net income (loss) | | — | | | — | | | — | | | 361,402 | | | — | | | — | | | 40,555 | | | 401,957 | | | (4,554) | |
| Unrealized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | 18,522 | | | — | | | 18,522 | | | — | |
| Realized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | (515) | | | — | | | (515) | | | — | |
| Foreign currency translation adjustments | | — | | | — | | | — | | | — | | | — | | | (42,319) | | | — | | | (42,319) | | | (151) | |
| Balances at September 30, 2022 | | 227,137,581 | | | $ | 2,271 | | | $ | 2,852,112 | | | $ | (2,768,195) | | | $ | (6,865) | | | $ | (153,883) | | | $ | 473,116 | | | $ | 398,556 | | | $ | 598,981 | |
See Notes to Consolidated Financial Statements
7
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Live Nation Stockholders’ Equity | | | | | | | | | | | | | |
| | Common Shares Issued | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Cost of Shares Held in Treasury | | Accumulated Other Comprehensive Loss | | Noncontrolling Interests | | Total Equity | | Redeemable Noncontrolling Interests | | | | | | | |
| | (in thousands, except share data) | | (in thousands) | | | | | | | |
| Balances at December 31, 2021 | | 221,964,734 | | | $ | 2,220 | | | $ | 2,897,695 | | | $ | (3,327,737) | | | $ | (6,865) | | | $ | (147,964) | | | $ | 394,197 | | | $ | (188,454) | | | $ | 551,921 | | | | | | | | |
| Cumulative effect of change in accounting principle | | — | | | — | | | (95,986) | | | 60,522 | | | — | | | — | | | — | | | (35,464) | | | — | | | | | | | | |
| Non-cash and stock-based compensation | | — | | | — | | | 198,740 | | | — | | | — | | | — | | | — | | | 198,740 | | | — | | | | | | | | |
| Common stock issued under stock plans, net of shares withheld for employee taxes | | 1,616,274 | | | 16 | | | (46,969) | | | — | | | — | | | — | | | — | | | (46,953) | | | — | | | | | | | | |
| Exercise of stock options | | 3,556,573 | | | 35 | | | 35,663 | | | — | | | — | | | — | | | — | | | 35,698 | | | — | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Acquisitions | | — | | | — | | | — | | | — | | | — | | | — | | | 5,181 | | | 5,181 | | | 18,406 | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Purchases of noncontrolling interests | | — | | | — | | | (38,492) | | | — | | | — | | | — | | | (7,653) | | | (46,145) | | | (1,457) | | | | | | | | |
| Sales of noncontrolling interests | | — | | | — | | | — | | | — | | | — | | | — | | | (336) | | | (336) | | | — | | | | | | | | |
| Redeemable noncontrolling interests fair value adjustments | | — | | | — | | | (98,574) | | | — | | | — | | | — | | | — | | | (98,574) | | | 98,414 | | | | | | | | |
| Contributions received | | — | | | — | | | — | | | — | | | — | | | — | | | 16,719 | | | 16,719 | | | 25 | | | | | | | | |
| Cash distributions | | — | | | — | | | — | | | — | | | — | | | — | | | (64,682) | | | (64,682) | | | (17,170) | | | | | | | | |
| Other | | — | | | — | | | 35 | | | — | | | — | | | — | | | 49,007 | | | 49,042 | | | (48,128) | | | | | | | | |
| Comprehensive income (loss): | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income | | — | | | — | | | — | | | 499,020 | | | — | | | — | | | 80,683 | | | 579,703 | | | (2,879) | | | | | | | | |
| Unrealized gain on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | 50,178 | | | — | | | 50,178 | | | — | | | | | | | | |
| Realized loss on cash flow hedge | | — | | | — | | | — | | | — | | | — | | | 2,634 | | | — | | | 2,634 | | | | | | | | | | |
| Foreign currency translation adjustments | | — | | | — | | | — | | | — | | | — | | | (58,731) | | | — | | | (58,731) | | | (151) | | | | | | | | |
| Balances at September 30, 2022 | | 227,137,581 | | | $ | 2,271 | | | $ | 2,852,112 | | | $ | (2,768,195) | | | $ | (6,865) | | | $ | (153,883) | | | $ | 473,116 | | | $ | 398,556 | | | $ | 598,981 | | | | | | | | |
See Notes to Consolidated Financial Statements
8
LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED) | | | | | | | | | | | |
| | Nine Months Ended
September 30, |
| | 2023 | | 2022 |
| | (in thousands) |
| CASH FLOWS FROM OPERATING ACTIVITIES | | | |
| Net income | $ | 916,210 | | | $ | 576,824 | |
| Reconciling items: | | | |
| Depreciation | 193,654 | | | 162,943 | |
| Amortization | 188,698 | | | 155,546 | |
| Amortization of non-recoupable ticketing contract advances | 58,518 | | | 56,121 | |
| Deferred income tax benefit | (10,419) | | | (155) | |
| Amortization of debt issuance costs and discounts | 13,707 | | | 12,333 | |
| Loss on extinguishment of debt | 18,366 | | | — | |
| Stock-based compensation expense | 85,905 | | | 86,178 | |
| Unrealized changes in fair value of contingent consideration | 42,092 | | | 23,601 | |
| | | |
| Equity in losses of nonconsolidated affiliates, net of distributions | 7,013 | | | 31,420 | |
| Provision for uncollectible accounts receivable | 35,707 | | | 40,736 | |
| Gain on mark-to-market of equity investments | (46,720) | | | (6,757) | |
| Other, net | (12,249) | | | (4,077) | |
| Changes in operating assets and liabilities, net of effects of acquisitions and dispositions: | | | |
| Increase in accounts receivable | (1,014,739) | | | (1,009,472) | |
| Increase in prepaid expenses and other assets | (479,434) | | | (297,379) | |
| | | |
| Increase in accounts payable, accrued expenses and other liabilities | 916,619 | | | 1,536,196 | |
| Decrease in deferred revenue | (150,487) | | | (435,701) | |
| Net cash provided by operating activities | 762,441 | | | 928,357 | |
| CASH FLOWS FROM INVESTING ACTIVITIES | | | |
| Advances of notes receivable | (129,532) | | | (58,307) | |
| Collections of notes receivable | 9,550 | | | 16,473 | |
| | | |
| Investments made in nonconsolidated affiliates | (45,439) | | | (73,335) | |
| Purchases of property, plant and equipment | (304,882) | | | (205,987) | |
| | | |
| Cash acquired from (paid for) acquisitions, net of cash paid (acquired) | 29,151 | | | (38,770) | |
| Purchases of intangible assets | (36,653) | | | (6,764) | |
| | | |
| Other, net | 13,841 | | | 6,962 | |
| Net cash used in investing activities | (463,964) | | | (359,728) | |
| CASH FLOWS FROM FINANCING ACTIVITIES | | | |
| Proceeds from long-term debt, net of debt issuance costs | 988,310 | | | 5,750 | |
| Payments on long-term debt | (625,659) | | | (29,462) | |
| Contributions from noncontrolling interests | 15,488 | | | 14,340 | |
| Distributions to noncontrolling interests | (153,789) | | | (81,852) | |
| Purchases and sales of noncontrolling interests, net | (89,819) | | | (27,104) | |
| Payments for capped call transactions | (75,500) | | | — | |
| Proceeds from exercise of stock options | 8,343 | | | 35,698 | |
| Taxes paid for net share settlement of equity awards | (9,001) | | | (46,953) | |
| Payments for deferred and contingent consideration | (13,690) | | | (45,164) | |
| Other, net | 249 | | | (472) | |
| Net cash provided by (used in) financing activities | 44,932 | | | (175,219) | |
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (421) | | | (325,011) | |
| Net increase in cash, cash equivalents, and restricted cash | 342,988 | | | 68,399 | |
| Cash, cash equivalents and restricted cash at beginning of period | 5,612,374 | | | 4,887,792 | |
| Cash, cash equivalents and restricted cash at end of period | $ | 5,955,362 | | | $ | 4,956,191 | |
See Notes to Consolidated Financial Statements
9
LIVE NATION ENTERTAINMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1—BASIS OF PRESENTATION AND OTHER INFORMATION
Preparation of Interim Financial Statements
The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X issued by the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, they include all normal and recurring accruals and adjustments necessary to present fairly the results of the interim periods shown. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our 2022 Annual Report on Form 10-K filed with the SEC on February 23, 2023.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes including, but not limited to, legal, tax and insurance accruals, acquisition accounting and impairments. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.
Seasonality
Our Concerts and Sponsorship & Advertising segments typically experience higher revenue and operating income in the second and third quarters as our outdoor venue concerts and festivals primarily occur from May through October in most major markets. Our Ticketing segment revenue is impacted by fluctuations in the availability and timing of events for sale to the public, which vary depending upon scheduling by our clients.
Cash flows from our Concerts segment typically have a slightly different seasonality as partial payments are often made for artist performance fees and production costs for tours in advance of the date the related event tickets go on sale. These artist fees and production costs are expensed when the event occurs. Once tickets for an event go on sale, we generally begin to receive payments from ticket sales in advance of when the event occurs. In the United States, this cash is largely associated with events in our operated venues, notably amphitheaters, festivals, theaters and clubs. Internationally, this cash is from a combination of both events in our operated venues, as well as events in third-party venues associated with our promoter’s share of tickets in allocation markets. We record these ticket sales as revenue when the event occurs. Our seasonality also results in higher balances in cash and cash equivalents, accounts receivable, prepaid expenses, accrued expenses and deferred revenue at different times in the year.
We expect our seasonality trends to evolve as we continue to expand our global operations.
Variable Interest Entities
In the normal course of business, we enter into joint ventures or make investments in companies that will allow us to expand our core business and enter new markets. In certain instances, such ventures or investments may be considered a VIE because the equity owners or the equity holders, as a group, lack the characteristics of a controlling financial interest. In determining whether we are the primary beneficiary of a VIE, we assess whether we have the power to direct activities that most significantly impact the economic performance of the entity and have the obligation to absorb losses or the right to receive benefits from the entity that could potentially be significant to the VIE. The activities we believe most significantly impact the economic performance of our VIEs include the unilateral ability to approve the annual budget, to terminate key management and to approve entering into agreements with artists, among others. We have certain rights and obligations related to our involvement in the VIEs, including the requirement to provide operational cash flow funding. As of September 30, 2023 and December 31, 2022, excluding intercompany balances and allocated goodwill and intangible assets, there were approximately $920 million and $514 million of assets and $570 million and $427 million of liabilities, respectively, related to VIEs included in our balance sheets. None of our VIEs are significant on an individual basis.
Cash and Cash Equivalents
Included in the September 30, 2023 and December 31, 2022 cash and cash equivalents balance is $1.3 billion and $1.5 billion, respectively, of cash received that includes the face value of tickets sold on behalf of our ticketing clients and their share of service charges (“client cash”), which amounts are to be remitted to these clients. We generally do not utilize client cash for our own financing or investing activities as the amounts are payable to our clients on a regular basis. These amounts due to our clients are included in accounts payable, client accounts.
Income Taxes
Each reporting period, we evaluate the realizability of our deferred tax assets in each tax jurisdiction. As of September 30, 2023, we continued to maintain a full valuation allowance against our net deferred tax assets in certain jurisdictions due to cumulative pre-tax losses. As a result of the valuation allowances, no tax benefits have been recognized for losses incurred, if any, in those tax jurisdictions for the first nine months of 2023.
In August 2022, the Inflation Reduction Act (IRA) was enacted in the United States, which includes health care, clean energy, and income tax provisions. The income tax provisions amend the Internal Revenue Code to include among other things a corporate alternative minimum tax starting in the 2023 tax year. The Company is still assessing the impact due to a lack of United States Treasury regulations on this matter; however, the IRA is not expected to have a material impact on the Company's financial statements due to net operating losses and full valuation allowances for the United States, which is our most significant jurisdiction. We will continue to monitor to ensure our financial results and related tax disclosures are in compliance with the IRA tax legislation.
Accounting Pronouncements - Adopted
In October 2021, the FASB issued Accounting Standards Update (ASU) 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers. This ASU should be applied prospectively to acquisitions occurring on or after the effective date of December 15, 2022, and early adoption is permitted. We adopted this guidance on January 1, 2023. The adoption is not expected to have a material impact on our consolidated financial statements.
NOTE 2—LONG-LIVED ASSETS, INTANGIBLES, AND GOODWILL
Property, Plant and Equipment, Net
Property, plant and equipment, net, consisted of the following: | | | | | | | | | | | | | | |
| | September 30, 2023 | | December 31, 2022 |
| | (in thousands) |
| Land, buildings and improvements | | $ | 1,987,508 | | | $ | 1,648,488 | |
| Computer equipment and capitalized software | | 870,881 | | | 910,793 | |
| Furniture and other equipment | | 573,239 | | | 535,719 | |
| Construction in progress | | 281,862 | | | 244,618 | |
| Property, plant and equipment, gross | | 3,713,490 | | | 3,339,618 | |
| Less: accumulated depreciation | | 1,757,584 | | | 1,851,955 | |
| Property, plant and equipment, net | | $ | 1,955,906 | | | $ | 1,487,663 | |
Definite-lived Intangible Assets
The following table presents the changes in the gross carrying amount and accumulated amortization of definite-lived intangible assets for the nine months ended September 30, 2023:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Client /
vendor
relationships | | Revenue-
generating
contracts | | Venue management and leaseholds | | Trademarks
and
naming
rights | | | | Technology and Other (1) | | Total |
| (in thousands) |
| Balance as of December 31, 2022: | | | | | | | | | | | | |
Gross carrying amount | $ | 563,210 | | | $ | 824,785 | | | $ | 148,022 | | | $ | 188,596 | | | | | $ | 35,736 | | | $ | 1,760,349 | |
Accumulated amortization | (209,518) | | | (316,581) | | | (58,588) | | | (97,931) | | | | | (27,109) | | | (709,727) | |
| Net | 353,692 | | | 508,204 | | | 89,434 | | | 90,665 | | | | | 8,627 | | | 1,050,622 | |
| Gross carrying amount: | | | | | | | | | | |
Acquisitions and additions—current year | 47,478 | | | 51,369 | | | 77,074 | | | — | | | | | 21,789 | | | 197,710 | |
Acquisitions and additions—prior year | 619 | | | (1,830) | | | (11) | | | — | | | | | — | | | (1,222) | |
| | | | | | | | | | | | | |
| Foreign exchange | 8,582 | | | 38,841 | | | 1,166 | | | 5,560 | | | | | (429) | | | 53,720 | |
Other (2) | (16,527) | | | (53,926) | | | (583) | | | (13,625) | | | | | (37,015) | | | (121,676) | |
| Net change | 40,152 | | | 34,454 | | | 77,646 | | | (8,065) | | | | | (15,655) | | | 128,532 | |
| Accumulated amortization: | | | | | | | | | | |
Amortization | (59,064) | | | (73,939) | | | (15,540) | | | (13,912) | | | | | (13,680) | | | (176,135) | |
| | | | | | | | | | | | | |
| Foreign exchange | 223 | | | (1,079) | | | 107 | | | (446) | | | | | (368) | | | (1,563) | |
Other (2) | 16,301 | | | 53,926 | | | 650 | | | 13,781 | | | | | 37,037 | | | 121,695 | |
| Net change | (42,540) | | | (21,092) | | | (14,783) | | | (577) | | | | | 22,989 | | | (56,003) | |
| Balance as of September 30, 2023: | | | | | | | | | | | | |
Gross carrying amount | 603,362 | | | 859,239 | | | 225,668 | | | 180,531 | | | | | 20,081 | | | 1,888,881 | |
Accumulated amortization | (252,058) | | | (337,673) | | | (73,371) | | | (98,508) | | | | | (4,120) | | | (765,730) | |
| Net | $ | 351,304 | | | $ | 521,566 | | | $ | 152,297 | | | $ | 82,023 | | | | | $ | 15,961 | | | $ | 1,123,151 | |
(1) Other primarily includes intangible assets for non-compete agreements.
(2) Other primarily includes netdowns of fully amortized or impaired assets.
Included in the current year acquisitions and additions amounts above are definite-lived intangible assets primarily associated with the acquisitions of certain venue and artist management businesses located in the United States, a promoter business in South America, as well as additions for music publishing rights.
The 2023 acquisitions and additions to definite-lived intangible assets had weighted-average lives as follows:
| | | | | |
| Weighted-
Average
Life (years) |
| Revenue-generating contracts | 6 |
| Client/vendor relationships | 5 |
| |
| |
| Venue management and leaseholds | 13 |
Technology (1) | 3 |
| |
| All categories | 8 |
_____________________
(1) The weighted average life of technology intangibles does not include purchased software licenses that are typically amortized over 1 to 3 years.
Amortization of definite-lived intangible assets for the three months ended September 30, 2023 and 2022 was $63.4 million and $48.1 million, respectively, and for the nine months ended September 30, 2023 and 2022 was $176.1 million and $150.4 million, respectively. As acquisitions and dispositions occur in the future and the valuations of intangible assets for recent acquisitions are completed, amortization will vary.
Goodwill
The following table presents the changes in the carrying amount of goodwill in each of our reportable segments for the nine months ended September 30, 2023:
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Concerts | | Ticketing | | Sponsorship
& Advertising | | | | Total |
| (in thousands) |
| Balance as of December 31, 2022: | | | | | | | | | |
| Goodwill | $ | 1,349,426 | | | $ | 979,742 | | | $ | 635,575 | | | | | $ | 2,964,743 | |
| Accumulated impairment losses | (435,363) | | | — | | | — | | | | | (435,363) | |
| Net | 914,063 | | | 979,742 | | | 635,575 | | | | | 2,529,380 | |
| | | | | | | | | |
| Acquisitions—current year | 90,765 | | | — | | | — | | | | | 90,765 | |
| Acquisitions—prior year | 233 | | | 143 | | | — | | | | | 376 | |
| | | | | | | | | |
| Dispositions | (6,183) | | | — | | | — | | | | | (6,183) | |
| Foreign exchange | (1,444) | | | 22,127 | | | 18,505 | | | | | 39,188 | |
| | | | | | | | | |
| Balance as of September 30, 2023: | | | | | | | | | |
| Goodwill | 1,432,797 | | | 1,002,012 | | | 654,080 | | | | | 3,088,889 | |
| Accumulated impairment losses | (435,363) | | | — | | | — | | | | | (435,363) | |
| Net | $ | 997,434 | | | $ | 1,002,012 | | | $ | 654,080 | | | | | $ | 2,653,526 | |
Included in the current year acquisitions amounts above is goodwill primarily associated with the acquisitions of certain venue and artist management businesses located in the United States and Europe as well as a promoter business in South America.
We are in various stages of finalizing our acquisition accounting for recent acquisitions, which may include the use of external valuation consultants, and the completion of this accounting could result in a change to the associated purchase price allocations, including goodwill and our allocation between segments.
Investments in Nonconsolidated Affiliates
At September 30, 2023 and December 31, 2022, we had investments in nonconsolidated affiliates of $427.9 million and $408.8 million, respectively, included in other long-term assets on our consolidated balance sheets.
NOTE 3—LEASES
The significant components of operating lease expense are as follows:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended
September 30, | | Nine Months Ended
September 30, |
| 2023 | | 2022 | | 2023 | | 2022 |
| (in thousands) |
| Operating lease expense | $ | 63,954 | | | $ | 60,003 | | | $ | 206,282 | | | $ | 195,514 | |
| Variable and short-term lease expense | 85,148 | | | 64,548 | | | 157,453 | | | 117,441 | |
| Sublease income | (1,865) | | | (1,627) | | | (6,477) | | | (3,901) | |
| Net lease expense | $ | 147,237 | | | $ | 122,924 | | | $ | 357,258 | | | $ | 309,054 | |
Many of our leases contain contingent rent obligations based on revenue, tickets sold or other variables. Contingent rent obligations, including those related to subsequent changes in the prevailing index or market rate after lease inception, are not included in the initial measurement of the lease asset or liability and are recorded as rent expense in the period that the contingency is resolved.
Supplemental cash flow information for our operating leases is as follows:
| | | | | | | | | | | |
| Nine Months Ended
September 30, |
| 2023 | | 2022 |
| (in thousands) |
| Cash paid for amounts included in the measurement of lease liabilities | $ | 195,945 | | | $ | 177,847 | |
| Lease assets obtained in exchange for lease obligations, net of terminations | $ | 148,960 | | | $ | 289,977 | |
As of September 30, 2023, we have additional operating leases that have not yet commenced, with total lease payments of $122.9 million. These operating leases, which are not included on our consolidated balance sheets, have commencement dates ranging from October 2023 to June 2030 due to certain offices and venues under construction, with lease terms ranging from 2 to 30 years.
NOTE 4—LONG-TERM DEBT
Long-term debt, which includes finance leases, consisted of the following: | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | September 30, 2023 | | December 31, 2022 |
| | | | | (in thousands) |
| Senior Secured Credit Facility: | | | | |
| | | | | |
| Term loan A | | $ | 367,500 | | | $ | 382,500 | |
| Term loan B | | 839,089 | | | 845,644 | |
| | | | | |
| 6.5% Senior Secured Notes due 2027 | | 1,200,000 | | | 1,200,000 | |
| 3.75% Senior Secured Notes due 2028 | | 500,000 | | | 500,000 | |
| 4.875% Senior Notes due 2024 | | 575,000 | | | 575,000 | |
| 5.625% Senior Notes due 2026 | | 300,000 | | | 300,000 | |
| 4.75% Senior Notes due 2027 | | 950,000 | | | 950,000 | |
| 2.5% Convertible Senior Notes due 2023 | | — | | | 550,000 | |
| 2.0% Convertible Senior Notes due 2025 | | 400,000 | | | 400,000 | |
| 3.125% Convertible Senior Notes due 2029 | | 1,000,000 | | | — | |
| Other long-term debt | | 520,506 | | | 252,199 | |
| Total principal amount | | 6,652,095 | | | 5,955,343 | |
| Less: unamortized discounts and debt issuance costs | | (55,425) | | | (51,844) | |
| Total long-term debt, net of unamortized discounts and debt issuance costs | | 6,596,670 | | | 5,903,499 | |
| Less: current portion | | 50,609 | | | 620,032 | |
| Total long-term debt, net | | $ | 6,546,061 | | | $ | 5,283,467 | |
| | | | | | | |
Future maturities of long-term debt at September 30, 2023 are as follows: | | | | | |
| (in thousands) |
| Remainder of 2023 | $ | 24,581 | |
| 2024 | 1,473,511 | |
| 2025 | 49,320 | |
| 2026 | 1,394,829 | |
| 2027 | 2,153,779 | |
| Thereafter | 1,556,075 | |
| Total | $ | 6,652,095 | |
All long-term debt without a stated maturity date is considered current and is reflected as maturing in the earliest period shown in the table above. See Note 5 – Fair Value Measurements for discussion of the fair value measurement of our long-term debt.
3.125% Convertible Senior Notes due 2029
In January 2023, we issued $1.0 billion principal amount of 3.125% convertible senior notes due 2029 (the “2029 Notes”). Interest on the 2029 Notes is payable semi-annually in arrears on January 15 and July 15, beginning July 15, 2023, at a rate of 3.125% per annum. The notes will mature on January 15, 2029. The notes will be convertible, under certain circumstances, until October 15, 2028, and on or after such date without condition, at an initial conversion rate of 9.2259 shares of our common stock per $1,000 principal amount of notes, subject to adjustment, which represents a 50% conversion premium based on the last reported sale price for our common stock of $72.26 on January 9, 2023 prior to issuing the debt. Upon conversion, the notes may be settled in, at our election, shares of common stock or cash or a combination of cash and shares of common stock. Assuming we fully settle the notes in shares, the maximum number of shares that could be issued to satisfy the conversion is 13.8 million as of September 30, 2023.
We may redeem for cash all or any portion of the notes, at our option, on or after January 21, 2026 and before the 41st scheduled trading day before the maturity date, if the sales price of our common stock reaches specified targets as defined in the indenture. The redemption price will equal 100% of the principal amount of the notes plus accrued interest, if any.
If we experience a fundamental change, as defined in the indenture governing the notes, the holders of the 2029 Notes may require us to purchase for cash all or a portion of their notes, subject to specified exceptions, at a price equal to 100% of the principal amount of the notes plus accrued and unpaid interest, if any.
As of September 30, 2023, the remaining period for the unamortized debt issuance costs balance of $14.0 million was approximately five years and the value of the notes, if converted and fully settled in shares, did not exceed the principal amount of the notes. As of September 30, 2023, the effective interest rate on the notes was 3.4%.
In connection with the issuance of the 2029 Notes, we entered into privately negotiated capped call transactions with several counterparties. The cap price of the capped call transactions is initially $144.52, which represents a premium of 100% over the last reported sale price of the Company’s common stock on January 9, 2023. The cost of the capped call transactions was $75.5 million and was charged to additional paid-in capital.
Debt Extinguishment
In conjunction with the issuance of the 2029 Notes, we used approximately $485.8 million of the net proceeds to repurchase $440.0 million aggregate principal amount of the 2.5% convertible senior notes due 2023 resulting in a loss on debt repurchase of $18.4 million and a charge to additional paid-in capital for the induced conversion of $27.3 million. On March 15, 2023, we redeemed the remaining $110.0 million aggregate principal amount of the 2.5% convertible senior notes and issued 156,750 common shares of stock.
Senior Secured Facility Amendment
In February 2023, we amended our senior secured credit facility. The amendments provide for, among other things: (i) replacement of the benchmark reference rate of the Eurodollar Rate (as defined in the Credit Agreement) with the Term SOFR Rate for borrowings denominated in United States Dollars and for each Alternative Currency (as defined in the Credit Agreement), a corresponding reference rate, as set forth in the Amended Credit Agreement, (ii) deletion of the provisions regarding Canadian bankers’ acceptances, and (iii) the addition of the Company’s ability to draw letters of credit in Canadian Dollars.
Other Long-term Debt
As of September 30, 2023, other long-term debt includes $271.0 million for debt due in 2026 acquired as part of an acquisition of a venue management business in the United States during the first quarter of 2023.
NOTE 5—FAIR VALUE MEASUREMENTS
Recurring
The following table shows the fair value of our significant financial assets that are required to be measured at fair value on a recurring basis, which are classified on the consolidated balance sheets as cash and cash equivalents.