Live Nation Entertainment, Inc. (LYV) Q2 2015 Earnings Report, Transcript and Summary

Good afternoon. My name is Seth Duncan and I will be your conference facilitator today. At this time I would like to welcome everyone to the Live Nation Entertainment Second Quarter 2015 Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer period. Before we begin, Live Nation has asked me to remind you that this afternoon's call will contain certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ, including statements related to the company's anticipated financial performance, business prospects, new developments and similar matters. Please refer to Live Nation's SEC filings including the Risk Factors and cautionary statements included in the company's most recent filings on Form 10-K, 10-Q and 8-K for a description of risks and uncertainties that could impact the actual results. Live Nation will also refer to some non-GAAP measures on this call. In accordance with SEC Regulation G, Live Nation has provided a full reconciliation for the most comparable GAAP measures in their earnings release. The release, reconciliations and other financial or statistical information to be discussed on this call can be found under the Investor Relations tab on investors.livenationentertainment.com. It is now my pleasure to turn the call over to Michael Rapino, President and Chief Executive Officer of Live Nation Entertainment. Michael Rapino - President, Chief Executive Officer & Director: Thank you. Live Nation has continued growing in the second quarter and for the first half, with revenue up 12% and AOI up 6% on a constant currency basis in the second quarter. The increase in revenue was led by our concerts business as we continue attracting more fans to more shows globally, which in turn drives AOI growth in our advertising and ticketing businesses through first half of the year. With the majority of our tickets sold for the year, we are confident that we remain on track to deliver our 2015 plan, and all key leading indicators reinforce our expectations of continued top and bottom-line growth as we build global market share in our core concerts, advertising and ticketing businesses. We have built the industry's most scalable and unparalleled live platform, bringing 450 million fans in 40 countries to that magical two-hour event each year. Concerts are the flywheel for our high-margin on-site, advertising and ticketing businesses and this year we expect to deliver record operating results, increasing revenue and profitability for each of these businesses. Starting with the concerts business, we have now sold approximately 75% of our projected tickets for the year, and through July we are pacing 7% ahead of last year's ticket sales. This is our top leading indicator that we will increase concert attendance again this year. We continue to be the world's leading promoter for about three-quarters of the top 25 tours, including U2, Imagine Dragons, Luke Bryan, Kid Rock and One Direction. The strength of our global platform continues to deliver growth as we have increased year-on-year attendance. In the second quarter over a million more fans attended our shows. For the full year we expect to grow our fan base by over two million fans, which on its own would be one of the top five promoters in the world. Along with attendance growth, we have also grown per-fan on-site revenue this year by 18% to over $20 per fan in our amphitheaters and festivals as our new sales initiatives, particularly those focused on the high-end fans is paying off. At the same time, we continue building our global platform for the future, most recently adding Marek Lieberberg to establish our concerts business in Germany. Germany is one of the top three concert markets in the world and Marek has a history of promoting more than 700 shows for over two million fans each year. Adding these shows to Live Nation can make us the top promoter in Germany, and moving those two million tickets to the Ticketmaster platform in Germany will substantially increase our scale and market position and ticketing in Germany. With this move, Live Nation now has a promoting presence in all major Western European markets, along with our presence now in nine Asian markets, we are the only promoter able to provide global and regional touring support at scale for artists. Our artist managers continue to provide a strong pipeline of shows to our concerts and sponsorship division. In the sponsorship & advertising business, we have delivered strong growth through the first half, with both revenue and AOI up over 20% on a constant currency basis. Our key leading indicator for advertising, contracted net revenue is up 19% on a constant currency basis as of the end of the second quarter and we have sold 80% of our planned sponsorship for the year. This now gives us confidence that our AOI growth rate in sponsorship & advertising for the year will be in the low teens, an acceleration from recent years. Our online advertising continues to build rapidly, growing revenue by 36% and AOI by over 30% at constant currency for the first half. We now have over 65 million unique monthly visitors to our sites and broader network, making Live Nation one of the top three online music networks. On the content side, we have entered the second year of streaming live shows with Yahoo! Live, with an increased focus on festivals this year, including EDC in Vegas, Wireless and Creamfields in UK and Voodoo in New Orleans. Our Live Nation TV channel with VICE Media is launching this month in beta and to provide live music fans and advertisers a channel dedicated to live music content, delivered by VICE's unique story-telling ability. With the growth of our Festival businesses we are also continuing to build our base of major advertisers, increasing the number of companies that pay us over $1 million a year by 15%, now delivering a collective $200 million to Live Nation in 2015. With all parts of our advertising business now performing and growing rapidly, we expect a record level of AOI growth in 2015, with continued strong runway. Ticketmaster has continued building its global leadership as a ticketing marketplace this year, with 7% growth in traffic leading to a 10% increase in primary and secondary GTV. A key driver behind this growth in site visits and GTV has been our mobile first strategy, building our products for ease of use and viewing on mobile devices. Mobile now consistently accounts for more than half of our traffic, both in North America and internationally. And year-to-date we have deployed 27 updates to our apps globally as we are enhancing the fan experience. As a result, we continue seeing growth in mobile ticket sales, up 21% through the first half, and now accounting for 21% of all ticket sales. Our app install base continues to build as well, now at 19 million, as more fans are seeing the benefit from improved search and ticket management functionality. I am confident that 2015 will mark the true point of conversion of Ticketmaster to a technology company. We have the right leadership and technology teams in place, building a marketplace and delivering products with great fan features while also capturing cost savings for the business. With all this, Ticketmaster has never been better positioned. After growing the business in the first half of the year, we expect 2015 to be another year of growth and record results for the company and we are confident that we will deliver the final year of our three-year plan. Based on the strong position of our leading indicators in concerts and advertising and ticketing, operationally we expect revenue and AOI growth in each of these businesses and overall for Live Nation this year. And more fundamentally, we continue to see a wide set of both organic and acquisition opportunities to further grow each of these businesses beyond 2015, directly building on the success we have achieved to-date. With that, I will turn it over to Joe Berchtold, our COO, for more details.

Thanks, Michael. Looking at our business segments, first, concerts. Live Nation Concerts revenue in the second quarter was up 14% and AOI was up 9% on a constant currency basis. The revenue growth was driven by a 7% increase in attendance at our shows for the quarter, led by our festivals and arenas. Festival attendance was up 77% for the quarter to over two million fans as we increased the number of festivals in the quarter from 18 to 23 and had some activities shift into Q2 from the third quarter. Arena attendance was up 35% to over five million fans at 600 shows, up from approximately 450 shows in 2014. Looking forward to the second half, we're confident that we will deliver mid-single digit attendance growth and double-digit AOI growth at constant currency for the year. As Michael said, ticket sales for shows this year are up 7% through July, and our pipeline of shows in the second half, particularly the fourth quarter, is very strong and we expect to increase our show volume to about 24,000 this year. At Artist Nation, our Artist Management business, AOI fell in Q2 as we invested to launch new service lines. For the second half, we expect the business to perform more in line with the second half of last year, with timing weighed more to the fourth quarter. Turning to our Sponsorship & Advertising business. Revenue for the second quarter grew by 20% and AOI was up by 23% at constant currency, continuing its strong performance from the first quarter. Online advertising was particularly strong, with overall AOI growing 29% at constant currency as we continue to benefit from the structural shift towards digital advertising, particularly advertising targeting millennial audiences. Looking at our different markets, European online grew by about 55% and North America was up about 20%. Sponsorship revenue was up 22% for the quarter at constant currency, with both North America and Europe up consistently and Asia now contributing a material impact on our growth. With over $250 million in sponsorship and advertising now contracted for the year, we're confident enough to increase our expectations for the full year to low-teens AOI growth at constant currency. Finally, Ticketmaster. For the quarter, Ticketmaster revenue was up 2% and AOI was flat as global GTV increased 6%, all at constant currency. Primary GTV for the quarter was up 4%, with a slight decrease in tickets sold. Recognized ticket fees were negatively impacted by the increase in deferred ticket sales for Live Nation Concerts as seen in our 20% year-on-year increase in event-related deferred revenue, up to over $1 billion. Given the flow-through of these deferred tickets along with the expected on sales, we continue to expect low-single digit growth in primary ticket volume and mid-single digit growth in primary GTV for the year. Secondary GTV was up 38% for the quarter, as we continue to see the success in our strategy of aligning with content and providing fans their full set of choices with transparency. As a result, we are seeing conversion rates on integrated inventory events 30% higher than those with primary-only options. And our volume of events with integrated inventory continues to grow, up another 29% for the quarter. We expect secondary GTV to continue delivering strong growth for the rest of the year, with almost two-thirds of our volume in the second half and the fourth quarter being our largest quarter, given the combination of NFL, NHL and NBA games along with our concert on sales. In addition to this ticketing growth, we have now taken the steps necessary to reduce our cost base and deliver our North American tickets at a cost per ticket that is $0.35 lower than it was in 2012. Overall, based on our ticketing GTV projections combined with cost reductions, we continue to expect to deliver high single-digit AOI growth in ticketing at constant currency for 2015. In summary, now more than halfway through the year, we are confident we will deliver 2015 on plan. With regards to FX, we saw similar results in the second quarter as the first, with revenue impacted by 5% and AOI impacted by about 6%. On timing, we expect Q3 to be largely in line with last year and a strong Q4 across our businesses. Our concerts pipeline for the fourth quarter is quite strong, both in attendance and show count, including tours by Madonna and Janet Jackson in the United States, Maroon 5 in Asia, and U2 in Europe. And as a result, sponsorship & advertising growth looks very solid in the fourth quarter as well. And as we noted with ticketing, our secondary business is seasonably strong in the fourth quarter, and this along with expected on sales for 2016 concerts, makes us confident on the remainder of the year. I will now turn the call over to Kathy to go through more on our financial results.

Thanks, Joe. I will start with our results for the second quarter. Revenue at constant currency is $1.9 billion, up 12% from the same period in 2014. Reported revenue is $1.8 billion. AOI is $151 million at constant currency, up 6% over last year. Reported AOI is $142 million. And free cash flow is $91 million, up 10% compared to last year. At the end of June, our concerts-related deferred revenue, which is the monies we've received to date on tickets sold for events in the future at our owned or operated venues was $1 billion, an increase of 20% over the balance in June of last year of $858 million. Revenue growth for the quarter over last year was driven by higher concerts revenue from increased arena activity in North America and higher festival activity. Reported AOI for the second quarter was in line with last year at $142 million. Total FX impact to AOI for the second quarter was $9 million. Our sponsorship & advertising segment's AOI was up 23% at constant currency, with higher online advertising activity in festival sponsorship. Ticketing AOI was slightly down, with the shift in timing of ticket sales to the first quarter. Concerts AOI was flat to last year, and Artist Nation's AOI was lower as we invested in new service lines. Our operating income for the quarter was $42 million compared with $56 million last year due to higher amortization, primarily related to acquisitions. Net income this quarter was $15 million versus $23 million in 2014, driven by the lower operating income. Free cash flow in the second quarter is $91 million versus $83 million in 2014, driven by timing of interest and tax payments as well as lower distributions to noncontrolling interest partners. Turning to the results for the first half of the year. Revenue at constant currency is up 9% from last year to $3 billion. Reported revenue is $2.9 billion, up 3%. AOI is $225 million at constant currency, in line with last year. And reported AOI is $211 million. And free cash flow is $115 million. Revenue for the first six months was driven by growth in concerts, which delivered over half of the overall increase, up from higher North American arena activity and increased festival activity globally. All of our business segments had higher revenue over last year in the first six months. AOI for the six months was $211 million, as reported. Total FX impact to AOI for the first half was $14 million. Sponsorship & advertising AOI grew 23% at constant currency, with higher online advertising in festival sponsorship. Ticketing AOI was up 7% at constant currency from higher resale ticket sales, and increased primary ticket volume, primarily from concerts. Concerts AOI was impacted by the timing of the mix of shows year-to-date. As Joe noted, we expect higher activity for concerts in the back half of this year as indicated by the 20% increase in deferred revenue. Lastly, Artist Nation's AOI was lower with the investments we're making in additional service line. Operating income was $18 million for the six months compared to $43 million last year due to lower AOI along with higher amortization related to acquisitions. Our net loss in the first six months was $43 million, which was impacted by a $20 million non-cash adjustment to a certain working capital account due to changes in foreign exchange rates. Our normalized net loss excluding that was $23 million compared to a loss of $10 million last year. Free cash flow for the six months is $115 million, in line with last year. Our cash flow from operations was $357 million for the first six months and was up year-over-year, largely because of the increase in deferred revenue. As of June 30, we had cash of $1.5 billion, including $618 million in ticketing client cash and $707 million in net concert event-related cash with a free cash balance of $201 million. Our total capital expenditures year-to-date were $64 million with about a 50% split between maintenance and revenue-generating CapEx. For the full year, we expect that our total capital expenditures will be in line with our previous guidance at around 2% of revenue. As of June 30, our total debt, including capital leases, was $2 billion, and our weighted average cost of debt is 4.3%. Our debt covenant currently requires a maximum leverage ratio of 5 times, and we are comfortably in compliance at below 4 times as of June. We continue to expect that we will deliver on our three-year plan for 2015, with growth in both revenue and AOI on a constant currency basis while we continue to invest in our long-term growth strategies. In summary and all based on constant currency, overall we currently expect AOI for the third quarter to be largely in line with last year, along with a strong fourth quarter across our businesses. We continue to expect double-digit growth in concerts AOI for the year, with increased show activity in the back half of the year, particularly in the fourth quarter. We expect growth in Sponsorship & Advertising AOI to be in the low teens with the majority of the second half growth driven by a strong fourth quarter. With the projected strength of both primary and resale ticket sales, especially in the fourth quarter, we expect that ticketing will deliver high-single digit AOI growth for the year. And for Artist Nation, we expect AOI for the last half of the year to be more in line with the second half of last year, also more heavily weighted towards the fourth quarter. Thank you for joining us today. And we will now open the call for questions. Operator?

Thank you. And our first question comes from Amy Yong with Macquarie. Please go ahead. Amy Yong - Macquarie Capital (USA), Inc.: Thank you and congrats on the quarter. My first question is actually on the concert side. You made several acquisitions and I think in general they're accretive within two and a half years. Can you help us frame the financial impact of your deal with Marek Lieberberg? And now that you're wrapping up your acquisitions in Concerts, C3, Bonnaroo, what other festivals or regions could you expand into? And any thoughts on your latest output agreement with Time for Fun? Thank you.

Hey, Amy. It's Joe. Sure, let me try to take those in order. First of all, just looking at the deal with Marek, as we said, Marek has a history of doing over 700 shows and over 2 million fans. So added to our roughly 60 million fans that we have, it's a sizable addition. He's one of the top handful of promoters in the world on a stand-alone basis. So we think it's important both on a stand-alone basis and you can do the math and see the level that it will help increase across our business. But also as importantly, it really rounds out our European Asian market portfolio that lets us do regional and global tours more effectively for artists. So we think it's a key piece to accelerating that overall side of the business. Michael Rapino - President, Chief Executive Officer & Director: And let's just note, on MLK, in Germany to-date we basically have Ticketmaster Germany. Because it's an allocated market, we don't have a lot of activity. And generally in Germany overall Live Nation, Ticketmaster is about a negative to a zero business. Adding now this acquisition, which will be accretive day one because of the low cost we were able to attract Marek to come into the network, we get to start that machine now where we've already got a fixed cost base of TM Germany in place. We get to now allocate tickets to our own platform. Historically, when we brought a Madonna and a U2 into Germany, we sold those off to Marek or someone else. Now we get to self-promote. And then once you start self-promoting with tickets, you start to expand your sponsorship base. So we're very, very proud about this deal. We've been working on it a long time. And, Andre, his son, and Marek provide us an instant base business in Germany to build our TM+ – TM business as well as our sponsorship and concerts and grow it from day one.

And then, Amy, as the second question on what other festivals and regions. As you know, we look at all of this globally, now in more than 40 countries. So we'll continue to look at festivals in Asia and Latin America. As we've also talked broadly, Latin America continues to be a great opportunity. The U.S. as well. We still think that there remain opportunities for us to both build organically and potentially look at additional acquisitions here. So our global market share in concerts we think is in the 30% range and so we globally see great opportunities to continue to expand on that. And then further to your other Latin America question, yes, our output deal with Time for Fun is ending this year. And we are looking extensively at the full set of options we have to further our presence in that market. Amy Yong - Macquarie Capital (USA), Inc.: Great. And if I could just... Michael Rapino - President, Chief Executive Officer & Director: I would say that just a – Amy, to add one thing to Joe's comment, our output deal for T4Fun as well as CIE in Mexico have ended this year. So historically, much like the Marek Lieberberg conversation, we sold off our U2 shows and et cetera to either CIE in Mexico and T4Fun in Brazil. We have not renewed either of those deals nor plan on renewing those. We plan on taking our content and establishing a presence in those markets, so again we can start building our ticket, sponsorship and overall business off our content. So whether we do that through an acquisition or a startup, we're exploring all those options. But getting kind of from Canada going down to Mexico into South America, it's obviously a natural routing for the 50-plus tours we buy, so important markets for us to finish the play on, given we're spending lots of content. So... Amy Yong - Macquarie Capital (USA), Inc.: Great. Thank you. And then on the ticketing side, you've made several key hires. What kind of tangible benefit should we expect now that you've achieved $0.35 in cost savings? And how's competition with StubHub been trending? Thank you.

So we don't know how StubHub is doing, so hard to comment specifically on that. I think we've given you a lot of statistics about the growth of our share in the secondary business and our GTV in the secondary business. So we're feeling very good about our product, our service that we're offering to fans and the strength of that in the marketplace. So we have high expectations on continued success and growth in the secondary market. In terms of the ticketing business more broadly, as Michael's talked, our number one focus is continuing to expand that globally with what we're doing in Germany, with what we look to do in Latin America, and continue to scale that business is a key way that we're monetizing our concerts business. Michael Rapino - President, Chief Executive Officer & Director: And on Ticketmaster, Amy, we think we just have a ton of runway there. We have a top five global commerce site. Has not historically been anywhere near best-in-class in terms of converting all of that traffic, so a lot of the hires you'll see – we're always going to be centered around our two core missions: a better product and conversion. So whether it's one of our new hires from Virgin Airways who's going to focus around our loyalty and converting that base, or some of the great product people we've hired who are going to continually deliver a more seamless product on our mobile app and our mobile business. So the tangible benefit is I think what we're seeing on a quarterly basis: traffic up, conversion up, GTV up. To get all of those up, we know that we got to deliver a better product ongoing with the robust roadmap. I think we mentioned today that we had 27 updates to our mobile app, so we're very serious about having a best-in-class mobile experience from the minute you find out about that show to the digital ecosystem throughout. And we got to make sure that our conversion gets better and better as that massive traffic's coming through our door through mobile or on desktop, we want to make sure we know more about you. We've talked a lot about our sales force and our CRM strategy, really mining that data of all those customers that have either come before or are new to our site, offering them a better experience and ultimately converting them over time. So a lot of the hires or anything you see we do is all geared toward either better product and ultimately higher conversion against a very high traffic base that we currently have and the tangible benefits we'll see on continual GTV and traffic usage. Amy Yong - Macquarie Capital (USA), Inc.: Great. Thank you.

Thank you. Our next question comes from David Joyce with Evercore ISI. Please go ahead.

Thank you. A few clarifications, please. I was just wondering how long it would take for Marek Lieberberg to get up to that 700 show kind of run rate? And secondly, free cash dipped sequentially, I was wondering how much of that was due to acquisitions like Bonnaroo or anything else you could talk to and anything else that would have impacted that? Thanks. Michael Rapino - President, Chief Executive Officer & Director: So in terms of MLK getting up to speed, we expect it to be pretty quick. We announced it mid-year so that we made sure that as we're thinking about our tours that we're lining up for next year, that we're taking that into account that we'll have a German position to self-promote. That will obviously focus on the biggest stadium/arena-type shows, so I think we'll very quickly in the next year drive the bulk of that fan base. And then again he's up and running January 1, and the smaller shows tend to have a shorter lead time. So we would expect vast, vast mass majority of that hitting next year and then fully up to speed by 2017.

And then, David, on the free cash question, it's driven by acquisitions at about $60 million, and then the other big driver that is just continued advances for those artists and ticketing clients as we continue to grow the future of the business.

Thanks. And on the strong online advertising growth, how can you help us think about how much the Yahoo!'s streaming of live shows has contributed to that?

I think on a year-on-year basis, that's not a substantial growth contributor, given the timing of when the show started.

Okay. And how much longer do you have with the Yahoo! contract? Is that something that could be up for better economics, anything you can talk about there? Michael Rapino - President, Chief Executive Officer & Director: Yeah, we will continue to renew that on an annual basis, and as you can see this year, we were able to expand our content offering by increasing our festival presence. And I think by this point now, we have attracted a good audience and proof of concept that would let you know that there are many other advertisers or streaming platforms that are interested and excited about these opportunities still. We'll remain with Yahoo! as long as the economics work for both of us and we think this is a viable business going forward.

Thanks. And just one final question, if there's any update on when you'll be able to roll off the old Ticketmaster systems post-replatforming. Thank you. Michael Rapino - President, Chief Executive Officer & Director: I think, David, as we've talked about over the past year or so, the way that the evolution is working is on a modular basis. So we're replacing substantial portions of the system as we go along. I think that by certainly end of the year, you'll see again the vast, vast majority of the underlying technology, particularly on our Concerts business, has been replaced. A lot of it's not going to be visible to you, the consumer, because it's the back office plumbing.

Great. Thank you very much.

Thank you. Our next question comes from John Janedis at Jefferies. Please go ahead.

Hi. Thank you. I think there's a lot of interest in the VICE channel. Can you help us frame the upfront investment? Are you assuming an impact on digital advertising in the outlook? And over the long term, will that change the margin trajectory in the segment? Thank you. Michael Rapino - President, Chief Executive Officer & Director: All right, I'll try to step back. So let's get back to the strategy. As we've outlined, our first job over the last couple years was to consolidate and build our global platform from a digital basis. So now with over 65 million uniques on a digital basis, we have a wide platform. Obviously like anyone else in digital advertising, the advertisers are looking for more and more sticky content that we could create to satisfy their needs. Yahoo! was our first toe in the water to validate that we could deliver that. And now VICE will be that next evolution, where we'll launch a start-up channel, we'll have lots of content, original programming, all based around the Live Music business. And we think it's absolutely all incremental new advertising to our platform. It'll be a new channel. We'll have multiple distribution points. And as we get the combination of the content right with the distribution right, we just think it's all incremental eyeballs and advertising to our current base business. John, does that give you a good basis?

Yeah, that does. Thanks. But just in terms of – I'm just thinking about the model. Anything upfront we should be thinking? Meaning is this a single-digit million kind of investment? Is it low-double? Is there anything you can help there? It would be useful I think for modeling. Michael Rapino - President, Chief Executive Officer & Director: Well, we hope to because it's an – we assume like the Yahoo! Model, the investment ultimately gets recouped within that same year by the advertisers. So Yahoo! was a multi-million dollar investment to stage all those shows annually and we've been able with Yahoo! to deliver a profit against that business. We look at VICE in a similar fashion. There's a start-up cost to create some new content, but we believe that through distribution once we get rolling over the next six months and the eyeballs are delivered, that we'll be netting ourselves incremental AOI, advertising and digital next year from this.

Okay. Great. Thanks, Michael.

Thank you. Our next question comes from Doug Arthur at Huber Research. Please go ahead.

Yeah. Thanks. I guess three questions. Question one, I'm not quite used to such a big emphasis on the fourth quarter to make the year numbers. I get the Ticketmaster timing thing. But what are you seeing in the concert business for the third quarter that gives you a little pause? The second question, international attendance. It was down a fair amount in 2014 but the events were down. Now the events are up, but the attendance is still down. Is that just mix? If you could clarify that. And then, Kathy, on your statement about Artist Nation in the second half, are you saying in line with last year results or in line with the growth of last year's results? Thanks.

So, Doug, this is Joe. Let me take those. So first of all, there's nothing giving us pause on Q3. I don't think we've said that. What we said is that our line-up for Q4, on a Q4 to Q4 basis, is particularly strong. I gave you some examples of the shows that we have. It just so happens that from a timing of touring perspective, this year our show counts and our expectations for attendance in Q4 are quite strong. As we said our tickets sold for shows occurring this year is up 7% for the year, so that gives us a strong underlying level of confidence in where we end up strongly with growth in global attendance at our shows, so just trying to give you the timing of that Q3 to Q4 where a lot of that is coming from that we're seeing. In terms of the specifics on the international side, yes it's simply a type of show mix that we have, fewer stadium shows this year but a very strong arena and festival line-up, so you're just seeing some show mix there. But again globally our expectations are both North America and international, fan growth for the full year. You're obviously also seeing the impact coming out of Europe of FX at the percentages that I told you. And then specifically as it relates to Artist Nation, the comment was that for the second half that the overall results are more in line with what the overall results were last year for the second half. We've been investing in scaling that business, adding some new service lines. As we've often talked about for our Artist Nation business, the most critical aspect of it is that it's aligned with and feeds our concerts and sponsorship business that drives the scale that we have there. We've had great success in terms of building our share and show count with all of the artists in Artist Nation because of the value that we're delivering for them from the core businesses, so our focus is very highly on building that business in an alignment with the rest of the businesses, so just trying to give you some specifics on where we think that's going in the second half.

Okay. Thank you very much.

Thank you. Ladies and gentlemen, this concludes the Live Nation Entertainment second quarter 2015 earnings conference call.