Formula One Group

Greetings and welcome to the Liberty Media Corporation and Atlanta Brave Holding 2023 year-end earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Shane Kleinstein, Senior Vice President of Investor Relations. Thank you, Shane. You may begin.

Thank you. Good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Form 10-K filed by Liberty Media and Atlanta Breeze Holdings with the SEC. These forward-looking statements speak only as of the date of this call. and Liberty Media and Atlanta Braves Holdings expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Media or Atlanta Braves Holdings' expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. On today's call, we will discuss certain non-GAAP financial measures for Liberty Media, SiriusXM, and Atlanta Braves Holdings, including adjusted OIBA and adjusted EBITDA. The required definitions and reconciliations for Liberty Media, SiriusXM, and Atlanta Braves Holdings, Schedules 1 through 3, can be found at the end of the earnings press releases issued today, which are available on Liberty Media and Atlanta Braves Holdings websites. Now I'd like to turn the call over to Greg Maffei, Liberty's President and CEO.

Thank you, Shane, and good morning to all. Today, speaking on the call, we will also have Formula One's President and CEO, Stefano Domenicali, and Liberty's Chief Accounting and Principal Financial Officer, Brian Wendling. Also, during the Q&A, we will answer any questions related to Atlanta Braves Holdings and Braves Manager will be available too. So let me begin with Liberty SiriusXM. The LSXM Siri transaction is on schedule. We filed the preliminary proxy on the 1st, January 30th rather. We still expect to close by early Q3. And the NAV discount, which was about 42% prior to announcement, is now closed to about 25%, as we had hoped. And we expect it will continue to close. Looking at SiriusXM itself, the strong operating and financial performance that it had in 2023 showed the durability of the business. Self-pay net ads were up in the second half, as expected, boosted by streaming. The strong margins and free cash flow generation remained, largely through cost discipline. Importantly, they rebuilt their tech stack and relaunched their app in the fourth quarter, and we're beginning to show positive early results from that with better personalization, promising engagement, and improved service quality. We believe these initiatives, as well as the incremental content they added, will continue to drive long-term growth. Looking at the 2024 priorities of the business, First, increasing 360L adoption and boosting conversion and retention, continuing to deliver engaging content. Recently, they signed the quite popular SmartList podcast with Jason Bateman, Will Arnett, and Sean Hayes. We do expect self-pay net ad improvement throughout the year, and there is a focus on maintaining stable dividend margins and free cash flow. I look forward to remaining involved personally in the next evolution of the business as chairman and a shareholder. Turning to Formula One Group, an amazing 2023 at F1. We saw double-digit growth across all revenue streams and adjusted oil up 22%. We see a strong commercial start to the season, four race promotion renewals, including Silverstone, a 10-year deal with venue upgrades in an important heritage market, and a new race in Madrid beginning in 2026, which will be a partial street race with convenient fan access. We do see continued growth in fandom. Recently, this week, F1 joined threads, and 2.8 million followers were on board at the platform after half a day of use. We closed the Quint acquisition in January, as we previously noted, and it's that growing partnership opportunities from Quint with F1, LBGP, and other sports properties, including the Kentucky Derby and the NBA All-Star Game. Let me turn to a minute to Vegas. It was an incredible race. We were fortunate to have such a great outcome with a record 181 overtakes and the podium came down to the final lap. It was a great result for Formula One. It created new commercial opportunities and generated fantastic global buzz. A high percentage of the first time F1 attendees and massive audiences tuned in to this race. It drew marquee brands to F1, for example, American Express, T-Mobile, Moet Hennessy, Google, and we think these brands and the marquee aspects of joining Vegas will continue to help us in 2024 and beyond. It was also hugely successful for the local community. The total economic impact of the race was estimated at $1.2 billion, and the average visitor spent 3.6 times what a typical visitor spends for a non-F1 event. We look forward to building on the success of LBGP in 2024. For example, we're going to increase the GA and expand the product offerings at various price points. We're going to optimize the cost structure. The year-round commercialization efforts at Grand Prix Plaza are developing, but we will expect only a modest contribution from those in 2024. Corporate events at that site kicked off around the Super Bowl this year. In summary, the Vegas race exceeded our expectations on many levels, even though year one costs came in higher than we had anticipated. We do not intend to disclose race specifics on this race consistent with our practice across all races. I would note that we are kicking off the F1 season with testing in Bahrain, which occurred, and look forward to the first race in Bahrain this weekend. Turn to Live Nation. 2023 was the biggest year ever, where there were all-time highs for attendance, ticket sales, and sponsorship. Concert attendance grew 20% with 145 million fans. Global demand for concerts continues to grow. The top 50 tours did 50% more international acts in 2023. We have an incredible pipeline for 2024 with no sign of consumer slowdown. We're seeing strong demand across all price points. For example, large venue shows are up double digits, and 65% of full-year large venue shows are already booked versus only 50% last year at this time. The number of shows at amphitheaters and other operated venues will also increase in 2024. Let me turn to the Braves. Obviously, there was incredible team performance in 2023. So much to highlight. I dealt one The 947 runs scored was the first in MLB, and it tied an MLB home run record as well for the team. The Braves also experienced great financial growth for the year. Baseball revenue was up 9%. We've seen continued success result in higher payments under MLB's revenue sharing plan, so that is the one negative about our continued revenue growth. But I'd also note the battery revenue was up 10%. and not Justin Oye, but it was up 11%. We clearly benefit from the strength of the Braves territory. In a recent study by YouGov, the Braves had 8.4 million fans in the South region, number one in MLB, and over 65% of all other local sports teams fans support the Braves, which is the highest crossover of any fandom in Atlanta. We've seen encouraging early season trades, including for seven-time All-Star Chris Sale and outfielder Jared Kalanick. We are well positioned for future commercial and on-field success. For example, 2024 season tickets are already sold out, and there is a 16,000-person wait list. We are looking forward with bated breath to the home opener against the D-backs on April 5th. And with that, let me turn it over to Brian for more on our financial results.