Venu Holding Corporation

This conference call is being recorded and will be made available online along with further earning press release at venue.live in accordance with the company's retention policies. All participants on today's call are in listen-only mode. Following your prepared remarks, we will open the line for a Q&A session. At this time, I'd like to turn the call over to Heather Atkinson, Chief Financial Officer of Venue Holding Corporation. Heather, please go ahead.

Thank you all for joining Venue Holding Corporation's year-end 2024 earnings call and business update. On the call today, we have our senior leadership team, myself, founder, chairman, and CEO, JW Roth, President Will Hodson, and Chief Marketing Officer Terry Liebler. Following the Safe Harbor Statement, JW will provide a year-end review and share highlights from across the business. We will then offer an update on our current and upcoming expansion plans. Finally, I'll provide a summary of our full year financial results for 2024. After that, as our operator mentioned, we'll open the call for questions. We'd like to remind everyone that various remarks about future expectations, plans, and prospects constitute forward-looking statements for purposes of safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Venue cautions that these forward-looking statements are subject to risk and uncertainties that may cause our actual results to differ materially from those indicated, including risks described in the company's annual report on Form 10-K for the year ended December 31, 2024, and our other filings with the SEC, all of which can be reviewed on the company's website at venue.live, spelled V-E-N-U dot L-I-V-E, or on the SEC's website at sec.gov. Any forward-looking statements made on this conference call speak only as of today's date, Monday, March 31, 2025, and the venue does not intend to update any of these forward-looking statements to reflect events or circumstances that would occur after today's date, except as may be required by federal security laws. With that said, I'd like to turn the call over to our founder, chairman, and CEO, J.W. Roth.

Thank you very much, Heather, and good afternoon, everyone. We appreciate you joining us today. as I read our prepared remarks. For those just getting to know us, our company is completely reimagining what live entertainment can be. Here at Venue, we are a leading developer, owner, and operator of luxury music venues, from open-air amphitheaters to intimate music halls, all designed with one goal in mind, artist-centric, fan-focused, experience-driven ambiance. We're known for pushing the boundaries on ambiance, offering elevated amenities like our Lux fire suites and custom-built owners clubs, premium Aikman clubs. Our next level entertainment campuses include premium restaurants and event spaces with amphitheaters ranging from 9,500 to 20,000 seats. Before we get started into what's next, let's talk about this past year. In July of 2024, we announced $105 million ultra luxury amphitheater in El Paso, Texas. made possible through a landmark public-private partnership, marking a major milestone in our expansion across the Southwest. Just one month later, in August of 2024, we celebrated the grand opening of the 8,000-seat Ford Amphitheater in Colorado Springs. Despite launching partway through the season, the venue welcomed more than 112,000 guests from over 5,500 zip codes nationwide. and was nominated for Polestar Magazine's 2024 Best New Concert Venue of the Year. Ford Amphitheater is booked and operated through a strategic partnership with Anschutz Entertainment Group, specifically AEG Presents Rocky Mountains. It has been an exceptional collaboration, and we are thrilled to continue this journey together through the years ahead. Throughout 2024, we also established significant partnerships and sponsorships with Colorado Ford Dealers, Anheuser-Busch, Kaiser Permanente, Boingo, NFL Hall of Fame quarterback Troy Aikman, Coca-Cola, Jack Daniels, and 8 Elite Beer, further elevating our brand and fan experience. In October of 2024, we officially broke ground on our new amphitheater in Broken Arrow, Oklahoma, and began construction phases for five additional venues in Texas and Oklahoma, pushing the momentum on our expansion plans Our established operating campuses included Colorado Springs, Colorado, Northern Atlanta in Gainesville, Tulsa Market in Broken Arrow, Oklahoma, Oklahoma City Market located in Yukon, Oklahoma, and the Dallas-Fort Worth Market located in McKinney, Texas, El Paso, Texas, and five additional markets that are currently in the pre-construction stage. According to our projections, we are tracking to welcome 3.7 million guests in 2026, and to reach the more 4 million guests annually across all of our entities by early 2027. The following month, in November of 2024, we successfully completed our initial public offering, listing on the NYSE American and raising approximately $12.3 million in net proceeds. To support this momentum, we made a key addition to our leadership team late in 2024. We welcomed Will Hodgin, our president, bringing with him more than 17 years of experience at Live Nation, most recently serving as the head of House of Blues. Shortly after, Terry Leibler joined us as Chief Marketing Officer. With three decades of experience in sports and entertainment, including the last 22 years at Live Nation, Terry brings unparalleled experience to our growing team. That same month, we launched the Venue Arts and Culture Foundation, reinforcing our long-term commitment to supporting local talent and enriching community vibrancy through the arts. Closing out 2024, Firesuite sales ended at an impressive $77.7 million. This trend has continued into the new year. We finished January at 10.4 million in sales, February at 11.2 million in sales, well on our way to our ambitious $200 million goal in Firesuite sales this year as we open new markets. Now, looking into the new year, Early in the new year, we officially closed on a 46-acre property in McKinney, Texas, the future home of our $300 million multi-seasonal Sunset Amphitheater. With a planned full capacity of 20,000, it will be the largest venue in our collection to date. Located just north of Dallas, McKinney is one of the fastest-growing cities in America, making it an ideal location for this ultra-luxe development. A few weeks later, venue took over Wall Street and rang the opening bell on the New York Stock Exchange. We introduced a groundbreaking multi-configuration model across our new amphitheaters, transforming them from seasonal venues into year-round destinations. By integrating climate-controlled environments, adaptable staging, and premium guest accommodations, this innovative design is built to maximize revenue, expand margins, and drive long-term shareholder value. As mentioned earlier, we have been breaking our own records when it comes to our Lux Fire Suite sales with very strong start to year, and we're on track to reach our sales goals of $200 million in 2025. As we spent time in the market, we recognized an opportunity to broaden sales pipelines through financing. Last month, we announced our new fractional ownership financing program. designed to accelerate the expansion of our popular investment opportunity, Lux Fire Suites. It's been a massive hit. The program is already seeing results of this launch, which will be announced fully in the next coming days. We added to our portfolio of offerings and launched the Venue Income Fund, which is designed for RIAs and broker-dealers to provide the potential for consistent monthly income to its income-seeking investors through pooled ownership of Venue's Lux Fire Suites. located both in McKinney, Texas and Broken Arrow, Oklahoma. Finally, in 2024 and into 2025, we were fortunate to have our story featured in a number of respected media outlets, including the Wall Street Journal, Bloomberg, CNBC Small Market Stocks, Big Money, TMZ with Troy Aikman, The Schwab Network, Venues Now, Polestar, The New York Post, and Cheddar, just to name a few. Now we get to what's on the horizons. As we approach the second quarter and look ahead to the rest of this year, our momentum continues to build. We're gearing up for a full season of unforgettable shows at the Ford Amphitheater here in Colorado Springs. It's shaping up to be nothing short of spectacular. This year, we will also unveil our new $41 million premium event center on the perimeter of the Ford Amphitheater. This state-of-the-art facility will feature elevated owners clubs, and our year-round restaurant and bars, Ross Seafood and Shop House, all paired with breathtaking views of the stage and surrounding landscape, including the United States Air Force Academy. Meanwhile, we have broke ground in McKinney and continue to make major progress on our construction in Broken Arrow, Yukon, and El Paso, all incredible season of growth across the board. We anticipate a development profit this year as a result of the sale lease back of the Ford Amphitheater, the ground in Colorado Springs. As we know, it's taken upfront investment to get where we are. That being said, we expect to turn the corner to operational profitability in 2026, driven in part by the opening of four major venues in our portfolio, McKinney, Texas, El Paso, Texas, Broken Arrow, Oklahoma, and the Sunset Hospitality Collection at the Ford Amphitheater. Those entities in 2026, along with our other campuses, will drive our first year of overall operational profitability. Here's the deal. We're all in this building together, and we're building a game changer. Our team is laser focused on three things, developing the most premium live entertainment venues on earth, building a profitable, scalable business, and enhancing shareholder value at every turn. We achieve this by staying true to our vision, and continually optimizing our strategy. Every step forward is about pushing boundaries, bringing fans closer to the music, creating unforgettable moments for artists, and delivering unmatched value for our shareholders. The best is truly yet to come. With that said, I'd like to turn it over to our CFO, Heather Atkinson.

Thank you, JW. As JW mentioned earlier, The fractional ownership of our fire suite sales reached $77.7 million in 2024, representing a 250% increase over 2023's total of $22.2 million. Also, our total assets increased 114% to $178.4 million as of December 31, 2024, up from $83.2 million at December 31, 2023. Also, our property and equipment increased 138% to 137.2 million as of December 31, 2024, up from 57.7 million at December 31, 2023. Our total annual revenue rose 42% to 17.8 million in fiscal 24 compared to 12.6 million in fiscal 23. Our restaurant operations continued steady growth of 1.3 million and 14% in fiscal 24 compared to fiscal 23. Event center operations grew 2.2 million and 74% respectively in fiscal 24 compared to fiscal 23. Both operations were successful due to growth at the Colorado Springs campus along with the Georgia campus being fully operational during the full year of 24 compared to opening mid-year 2023. Amphitheater operations generated net profit to venue due to the opening and initial success of Ford Amphitheater, defined as profit after venue split with AEG presents Rocky Mountain, the operator of the amphitheater, with the receipts from our naming right agreements, which are outside of venue AEG's partnership agreement, combined for $1,659,291, or 9% of our total revenue for fiscal 24. Over the limited 2024 season of 20 shows at the Ford Amphitheater, this location generated gross receipts of $15.2 million. Those gross receipts, which are inclusive of ticket sales, concessions, ticketing fees, premium upgrades, as well as other receipts, are subject to the split with AEG. The Ford Amphitheater, booked and operated in partnership with AEG Presents Rocky Mountains, sold over 97,000 tickets and an average of $156 per ticket, and it's 20 shows of 2024. Thank you, JW, and thank you all for joining the call today. With that, I'd like to now turn the call back over to JW.

Heather, thank you. With that, we're going to open up the line to Q&A.

Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If we'd like to withdraw your question, simply press star one again. If you're called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking a question. Just a moment while we compile the roster. Your first question comes from the line of Martin Calvert of Morgan Stanley. Your line is open.

Thank you. J.W. and team, amazing first quarter. Wow, that's really impressive. The numbers just jumped off the page. I saw recently you entered into an agreement with Connect Partnership Group. How is the process going with sponsorships and strategic partners in this competitive landscape?

First, Marty.

Hi, Marty.

It's great.

Sorry.

Terry's going to jump in and answer that question, but I just wanted to thank you for joining the call.

Oh, absolutely, J.W. J.W.

Thanks, JW, and thanks, Marty, for the question. This is Terry Liebler, Chief Marketing Officer. We've had significant interest in venue sponsorship offerings for a lot of reasons. Actually, one of the primary reasons being this premium, elevated, and guest fan experience that we're introducing into the music industry. The sports industry has had tremendous success introducing premium and elevated experiences that brands can own and draw from. But in live music, especially in an outdoor seating, that's really trailed behind. So as a result, brands are expressing increased enthusiasm about the new value proposition that we are introducing, and it's a very exciting time to join a venue in what we're doing if you are a brand.

Oh, that's great. It looks like you've already got a lot of brands on board, but obviously with the new opportunities at the new venues, I'm sure that you're looking to take advantage of that.

100%. We are fielding lots of interest. Thanks again, Marty.

Your next question comes from the line of Greg Gibbous of Northland Securities. Your line is open.

Hey, good afternoon, J.W. and Heather. Congrats on the strong results and momentum that you're seeing. Apologies for my voice here, a little under the weather. But, you know, I wanted to just ask about your funding. You mentioned approximately 40% coming from new markets, you know, with fractional ownerships that you're pre-selling now. You also recently mentioned that you can now finance fractional ownership. How does that work exactly?

First, Greg, thanks for joining the call. At the end of the day, fractional ownership is changing. It's a game changer for our industry. You know, 40% or so of our financing comes from municipal relationships and public-private partnerships that we put together. But still, these amphitheaters are extremely expensive to build. And so in order to make them pencil, fractional ownership becomes a big part of what we do. And so 40% of our financing comes from fractional ownerships. And up until a few months ago, the millions and millions of dollars flown in to our projects have come from fully cash paid investors and fractional buyers. But a couple of months ago, we were able to add financing. And as a result of that, we have seen a doubling in our sales. banks have now stepped up and are financing fractional ownership, much like a bank would finance a mortgage on a condominium. And it's been a complete game changer for us. The other piece of that too, Greg, that's interesting is we've expanded the pool of potential buyers. So buyers of our fire pit suites used to be just your typical guy like me that just loves going to shows, buys a fire pit suite for him and his family and his friends, or corporations that buy them for to use with our customers and whatever. But now that pool with financing has completely changed, and it's expanded into triple net buyers. So now we're seeing a good percentage of our buyers on a weekly basis being triple net investors that are buying these for purely investment purposes.

Got it. Thanks for the call, J.L.B. You bet. Good luck.

Your next question comes from the line of Ray Oliver of Bear Creek Capital. Your line is open.

Hey, JW. Great job with you and the team. Really love seeing these numbers. You mentioned earlier that some of your construction plans and certain new projects to include multi-season configurations allowing for year-end revenue streams. Could you expand on what that looks like in practice and how it's shaping your overall business model?

Yeah, so when we – first, Ray, thanks for joining the call, and I appreciate you as a shareholder. You know, when we first sat down and started the process of developing what state-of-the-art amps look like, you know, you start with all of the things that are sort of driving the fan experience, right? And then at the end of the day, you're trying to figure out what can we do to expand the season. And so we started to look at and work with our architects to build a multi-seasonal configuration. which now is part of all of our new amphitheaters. And what that has done is it's just created a game-changing model for us in which we now have a 5,000 and 6,000 configuration that's year-round built into our 12,000 and 20,000 seat amps. And so this is something that you will i can't even explain what the ambiance will be like i say this all the time to our team can you imagine going to a to an outdoor concert in the dead of winter when it's 40 degrees outside and you're going to an outdoor amphitheater and you're going to watch that show and you're going to enjoy that show at 65 to 70 degrees that's ambience like you just won't experience any place else and i can't tell you how excited i am to open this first one in broken arrow with this multi-seasonal approach. It is an industry-changing venue.

Thanks, J.W.

And again, if you have a question, please press star 1 on your telephone keypad. Your next question comes from the line of Stephen Jimenez. Oh, my apologies. Your next question comes from the line of John Lutz of iHIT Industries LLC. Your line is open.

Thank you, JW. And I just want to let you know, I've went to a couple of concerts at the Ford Amphitheater this last summer. And I got to tell you, it's quite the experience. You've done a really spectacular job on that theater. And I'm thinking that's going to transform into all your projects. So well done there. I appreciate it, Jeff. You bet. My question is, what kind of fan experience innovations

uh are you going to be implementing to drive repeat attendance what's going to bring people back again and again just about aside from the spectacular nature of the venue yeah so that's a good question i mean right now we are focused on building world-class venues and sort of the the the core to our offering are the are the fire suites right so building that and then building around that is multi-seasonal configurations And what we talk about here at Venue on a daily basis is how do we increase dwell time? How do we increase the amount of time that somebody experiences Venue and one of our amps? And so really what we're trying to do now is increase dwell time by opening our clubs, the Aikman Club, our owner's club in Colorado Springs, the Seafood and Shop House, Bro Hands Rooftop Bars, all of those ads that are coming this season. will be focused on driving dwell time and ultimately driving ambiance and experience for the concert goer. There's not another place on planet Earth where you can go and see a concert like you do at the Ford Amphitheater. And there's not another place on Earth where you can come to an outdoor amphitheater like the Ford Amphitheater and enjoy dwell time that's an hour and a half to an hour and a half after the show and before the show and enjoy that kind of ambiance. Excellent. Thanks. You're welcome. And thanks again for your participation. You're a great shareholder.

Your next question comes from the line of Stephen Jimenez of TR Winston & Company. Your line is open.

Hi, everyone. Congratulations on your 2024 achievements. Thanks for taking my questions. To start expanding on questions and answers from earlier, I was wondering if you could help us think about your expected revenue mix. Do you have a long-term vision for diversifying your reoccurring top line beyond mainly ticketing sales and concessions? And perhaps as a follow-up to that, are there opportunities visible to expand non-music event utilization of your various campuses? Thanks.

Yeah, Steven, thanks for joining. I'll take the first one. I'm going to pass the second one on to Will. But again, I'm going to reiterate the importance of building multi-seasonal and multi-configuration amps. And so when we're looking at trying to diversify the revenue, I'm actually more interested in concentrating on what we're really good at and extracting more revenue out of key metrics. So dwell time is important and multi-seasonal configurations are important because what we're doing there is we're adding content We're also adding time for existing content. And so those are all sort of where our focus is. Not to get too far out in the weeds and too far out in the future, but we've got a really interesting tech team here at Venue. And we're working diligently on what will ultimately be a subscription model to a soft ticket. That's just a little hint of what is coming over the next year or so. And that is what's coming in terms of diversifying diversifying revenue. But thanks a million for joining us today, and thanks for your question. Will, I'm going to have you jump in and answer the second part.

Yeah. Hi, Will Hodson here, president of Venue. Thanks, Stephen, for the question. As JW said, right, diversifying what we do extends beyond what happens just in the venue. There's certainly a market for non-touring entertainment on our stages that can be in the form of a rental with a third-party promoter. day-long festivals that engage the community. The way these amphitheaters were designed and constructed lend ourselves to producing really great private events for larger companies, as well as, like I said, community activations like a food market, movie nights, certainly graduations with local schools. All those things can help us contribute more content on available days. I will say, too, that there's a focus for us definitely to, as JW said, increase dwell time, and that can happen with pre-event activations with local bands, same with post-show activations in our various VIP clubs. So certainly a primary focus for us as we continue to expand our content providers and what we can put on in a successful way at these unbelievable amphitheaters.

I appreciate that color from both of you. Thank you. It was very helpful.

Your next question comes from the line of Michael Bixby of Choice One Rx. Your line is open.

Gentlemen, ladies and gentlemen, fantastic presentation. I've enjoyed seeing where this is going. I've been following it for some time. While I see that you're currently deep in the development stage and laser focused on growth, can you provide some clarity on your path to profitability and when you anticipate reaching a break-even or at least generating some consistent positive operating income?

MG, I thank you for joining. And that's a really good question. So profitability is going to come in two different forms at two different times. This year, in 2025, we are going to realize a development profit, a significant development profit, as a result of the sale of our ground underneath the Ford Amphitheater and the lease back here in Colorado Springs. That will provide a significant profit this year. In 2026, we expect our first operational profit as we open all three new amps that will then operate in conjunction with the Ford Amphitheater here in Colorado Springs, as well as the Sunset Hospitality Collection and Event Centers here in Colorado Springs that will be opening here in the next 60 to 90 days. You know, I've been hell-bent, you know this. Over the next 48 to 60 months, we're going to build $3 to $3.5 billion worth of new venues, and we're going to build those with zero occupancy costs. So at the end of the day, We are building a machine here that is building what will be an unbelievable business in terms of generating profitability. So, again, 2025 for a development profit, 2026 for a sizable operational profit, and then over the course of the next 48 to 60 months, we'll open $3 to $3.5 billion worth of these that... That will be game-changing in every sense.

Outstanding.

Your next question comes from the mind of Stephen Lasich of Goldman Sachs. Your line is open.

Hey, guys. Thanks for taking the questions. Maybe two if I could. J.W., curious if you could talk a little bit more specifically Just about your latest thinking on the potential opportunity for venue footprint expansion beyond the next maybe three to five venues that you have in the pipeline. Curious East Coast, West Coast, where you see the most opportunity. And then maybe for Will, just touring supply in 2025, if you could talk a little bit about your outlook for amphitheater tours this year. 24 is a record ampere in North America. Curious if you're expected to see that momentum continue or if there could be a bit of a mix shift just back to stadiums as they come back online this year in 2025. Thank you.

Stephen, thanks for joining the call. I appreciate the question. So, you know, as we think about expansion, we have a very robust and aggressive forward-looking team, both internally and through Ryan and company in Dallas, out meeting with and talking with municipalities. Currently, we are in talks, as we've reported, with seven different municipalities that will be a We will be announcing later this next quarter and early into the fourth quarter about the expansion plans for 2026 with builds coming in 2027. There's really three key pieces to expansion, right? First, we're always looking for and developing municipalities along the routes that we feel would be best for us and for our content partners. So there's that first piece. The second is those municipalities have to be sort of geared toward and have an appetite toward a public-private partnership. And 99% of the time, that is driven by their focus on economic impact in their communities. So that's the second piece. And then the third piece is, those municipalities have to have a demographic that would be most likely to embrace fire suite ownership, fractional ownership, and ticket buying, right? So you're looking for specific, those three specific things as you expand. So right now we've got seven more coming that will be added to our five. And then in early, early stage for 2027, 28, and opening in 29, We have 12 more. So expansion is aggressive around here. And with our sort of ability to finance these the way we are, we're very optimistic that we're going to hit our goal of 20 units in the next 60 months or so.

Steven, I'll attack that second question. And thanks again for the question. Thanks for hopping on. You know, as you know, and as JW mentions often, the supply of new artists couldn't be greater. Obviously, each of those artists carries a different level of ticket demand. So it's really important, I think, that we understand the multi-configuration setup that we've got with these amphitheaters as well as the multi-seasonal. And when I say that, they're designed with the intent that we can scale these buildings down to a 5,000, 6,000 cap. and still operate efficiently with strong profitability in mind. And that just opens us up to a larger supply of artists that can play our buildings. Not all of them need to sell 13,000 tickets. And we have built a model that will allow us to promote and contract those artists' performances at various levels and still be extremely profitable. We've Again, increased our ability to attract a larger supply of artists that should help, will help navigate any shift in supply at various capacity levels, ticket demand levels. That's great. Thank you both.

Thank you, Stephen.

With no further questions in the queue, that does conclude our conference call for today. Thank you so much for your participation. You may now disconnect.