Madison Square Garden Sports Corp. (MSGS) Q1 2018 Earnings Report, Transcript and Summary

Good morning, my name is Christy, and I will be your conference operator today. At this time, I would like to welcome everyone to the Madison Square Garden Company Fiscal 2018 First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks there will be a question-and-answer session [Operator Instructions] Thank you. I would now like to turn the call over to Ari Danes, Senior Vice President of Investors Relations for the Madison Square Garden Company. Please go ahead, sir.

Thanks Christy, good morning and welcome to the Madison Square Garden Company’s fiscal 2018 first quarter earnings conference call. Our President and CEO, Doc O’Connor will begin this morning’s call with a discussion of the Company’s operations. This will be followed by a review of our financial results with Donna Coleman, our EVP and Chief Financial Officer. After our prepared remarks, we will open up the call for questions. If you do not have a copy of today’s earnings release, it is available in the Investors section of our corporate website. Please take note of the following. Today’s discussion may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties. And that actual results, developments and events may differ materially from those in the forward-looking statements as a result of various factors. These include financial community perceptions of the Company and its business, operations, financial condition and the industry in which it operates, as well as the factors described in the Company’s filings with the Securities and Exchange Commission, including the sections entitled Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained therein. The Company disclaims any obligation to update any forward-looking statements that may be discussed during this call. Lastly, on pages four and five of today’s earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating incomes, non-GAAP financial measure. I would like now introduce Doc O’Connor, President and CEO of the Madison Square Garden Company. Doc O’Connor: Thank you, Ari, and good morning everyone. We’re pleased with our start to fiscal 2018 and remain confidence that our company’s singular focus on providing the very best and live experiences uniquely positions us to drive long-term growth and value creation for our shareholders. In fiscal 2017, our commitment to efficiently and effectively harness the strength of our assets and brands led to a number of successes across the company from increased venue utilization to a record revenue for the Christmas Spectacular and for sponsorship and signage and we plan to continue building on those games. Another priority for our company has been growing our portfolio of premium live experience. And since July 2016, we’ve added world-class companies in festivals, hospitality and esports. We are now focused on supporting the growth of these business and on leveraging our combined assets and expertise to drive additional value. At the same time we are continuing to pursue opportunities to meaningfully expand our business via acquisition and development and see the expansion of our portfolio of venues as the centerpiece of our growth strategy going forward. So far this year we have made real progress on these stated priorities, starting with our continued success in increasing the utilization of our venues. A vibrant, live entertainment industry combined with our ongoing efforts to drive multi night and multi venue engagements, as well as a diverse array of family shows and marquee events have helped our bookings business generate record setting event numbers for the past two years. That momentum continued in the first quarter as our bookings business saw year-over-year increase in events held at our venues, putting us on a path for another strong year. A few of the memorable events from our first quarter included the Baker’s Dozen, an unprecedented 13-night run by Phish in Madison Square Garden, an equally impressive 16-show run by comedian Dave Chappelle at Radio City Music Hall and the MTV Video Music Awards which we hosted for the second consecutive year this time at the forum. The second quarter is providing to – is proving to be just as exciting with highlights that include multi-night shows from Guns N’ Roses and iHeartRadio’s Jingle Ball, at the garden in the forum, multi-night runs by Bruno Mars at the forum, Bob Dylan at the Beacon, and Chris Rock at the The Theater at Madison Square Garden, as well as Phish who will return for the world – to the world’s most famous arena in December for four shows, including one on New Year’s Eve. We’ve also recently announced the Billy Joel’s record setting residency will continue into 2018. And in January, music’s biggest night will return to MSG and New York City for the first time in 15 years as the Garden hosts the 60th Annual Grammy Awards, while the Tony Awards have announced their return to the legendary stage at Radio City Music Hall for their 72nd Annual Awards Show in June. With regard to marquee sporting events tomorrow night the garden will welcome back to UFC for the second time in the last year while next month championship boxing returns to MSG as Miguel Cotto defences his junior middleweight title for the last time before ending his illustrious career. We’re pleased with the continued progress we’ve made in growing our bookings business and remain firm believers that we will only amplify these results as we expand our venue footprint. We see a unique opportunity to take what we’ve achieved with the form to new heights through the creation of large scale music and entertainment focus venues equipped with game changing technologies that will pioneer the next-generation of live experiences. In addition to our plans to bring a groundbreaking new venue to Las Vegas we continue to explore select markets where we think our differentiated approach can be successful, driving long-term value for shareholders. We look forward to sharing more in early calendar 2018. Venue’s expansion has also been a key component to TAO Group’s growth strategy. In July TAO Group successfully completed a five-venue Hollywood complex, creating LA’s biggest nightlife destination. This was followed in September by the opening of MOXY Times Square in New York, which now features a number of TAO Group entertainment dining and night life experiences throughout the hotel, including one of the city’s largest all season hotel rooftop lounges. Looking ahead we are nearing the opening of TAO Group’s second international venue, LAVO Singapore, which will be located on the iconic rooftop of the Marina Bay Sands Hotel. With 25 venues now open and a robust pipeline, we expect TAO Group’s portfolio to grow significantly over the next several years. On our last earnings call we talked about the growth of TAO Group and noted that in addition to its venue expansion plans we are also increasingly optimistic about the ability to utilize premium assets and brands of both TAO Group and MSG, to drive incremental value. With TAO Group’s assets is part of our portfolio, our sales team is now able to provide companies with a full spectrum of premium hospitality offerings that can be tailored to meet their needs. We’ve had some terrific early success on this front and recently reached a first of its kind, comprehensive corporate hospitality agreement with the Fortune 500 company. This multiyear, multimillion dollar relationship, comparable in size to our signature marketing partnerships, create efficiencies and savings for this partner by allowing them to consolidate their entertainment spend with us across our portfolio of assets. This includes tickets suites and venue rentals as well as dining and private events at TAO Group’s venues. We’re pleased to have reached this agreement which has created a new hospitality partnership model for us to take to other potential corporate partners. In addition, last month we announced our first joint project Suite Sixteen and members-only lounge at Madison Square Garden, which will deliver Tao’s signature premium hospitality combined with the very best, in sports and entertainment. Early demand for memberships has been extremely robust and we believe this is just the beginning in terms of how we can work together with the TAO Group exploring additional opportunities to utilize the combined strength of our assets will continue to be a priority, particularly as we move forward with our venue expansion plans. Turning to productions, one of the ways we’re more effectively harnessing the strength of our brands is through thoughtful investments that help ensure we’re delivering the most innovative live experiences for our customers. Today people want and expect a more immersive experience which is why we are focused on employing next-generation technologies that will change the way we engage with our audiences. We’re starting with the Christmas Spectacular starring the Radio City Rockettes, which next Friday debuts for its 85th season. Utilizing the most advanced 4K digital mapping technology, available we will for the first time ever project imagery on all eight of the venues presidium arches. This large scale projection along with a backdrop that now includes one of the largest 8K resolution LED screens in the world, will visually transform the production completely immersing the entire audience in the show. We’re excited about these enhancements and look forward to a successful holiday season. Turning to Sports the 2017, 2018 Rangers and next season are underway. The Rangers who have made the playoffs the last seven years led by goalie Henrik Lundqvist, welcomed five new players this offseason. Meanwhile the Knicks under the leadership of President, Steve Mills and General Manager, Scott Perry, feature an exciting core group of young players led by Kristaps Porziņģis, and are focused on a long range plan to restore the pride and accountability that comes with playing in New York. With the start of the regular season we have seen some early impacts on Knicks’ ticket revenue. That said we believe in where the team is headed long-term and this new direction will lead to success. We also believe we have the right ticketing policy in place to capitalize on that success. As our strategy of reducing full season subscriptions and increasing sales of partial plans, along with group in individual tickets, creates lasting benefits for the company. These include helping us establish direct relationships with our customers and further broadening our fan base, both of which should positively impact revenues over the long-term. On the sponsorship and signage front last month we welcomed the brand new signature marketing partner Squarespace. In addition to becoming the Knicks first ever jersey sponsor through this multifaceted partnership, Squarespace will also have year-around exposure across our unrivalled portfolio of sports and entertainment assets, as well as on MSG Networks’ award winning regional sports networks. We’re extremely pleased to have reached this agreement and look forward to building this new partnership. Another excellent illustration of the meaningful value we provide our partners is the overall success we’ve had in renewing and expanding our marketing partnerships. As you know last fiscal year we kicked off the start of our renewal cycle with our signature partners by reaching new agreements with Anheuser Busch and Lexus. We’re pleased to report that we recently completed multi-year renewals with three additional signature partners, Delta Airlines, Charter Communications and Kiya, world-class companies that share our commitment to delivering exceptional experiences for customers. We look forward to continuing to provide all of our partners with the innovative platforms and unique and valuable exposure that come to expect from MSG. We also continue to make progress on new agreements for those Event, Lexus’ and Signature level suite products, up for renewal this year. We have reached new deals with solid built in annual escalators for nearly all of these suites and anticipate selling the remaining few in the near term. In summary, we’re pleased with our start to fiscal 2018 as we remain committed to pursuing opportunities to drive both organic and external growth. We continue to attract an increasing number of premium events to our venues and have had early successes that demonstrate the value of a combined MSG and TAO Group offering. Furthermore, we also continue to build our portfolio of live offerings and expect to make important strides on our venue expansion plans in the coming year. We remain confident that as a pure play company focused on premium live experiences, we are well-positioned to drive long term growth and value creation for our shareholders. With that I’ll now turn the call over to Donna who will take you through our financial results.

Thank you Doc. And good morning everyone. For the fiscal 2018 first quarter, our company generated total revenues of $245 million, an increase of 35% and adjusted operating income of $29 million, an increase of $27.4 million. At MSG Entertainment, revenues as $164.1 million increased 48%. This was primarily due to the inclusion of operating results for TAO Group and to a lesser extent higher overall event related revenues at the company’s venues. Partially offset by the absence of the New York’s spectacular production and to a lesser degree, lower sponsorship and signage revenues. With regard to the increase in overall event related revenues, as Doc mentioned, our booking business had another solid quarter, fueled by continued growth in concerts, which translated into revenue increases at Radio City Music Hall, the Chicago Theater and The Garden. These results were partially offset by lower revenues at the forum and the theater at Madison Square Garden. MSG Entertainment ALI of $17.8 million dollars increased by $18.8 million. This reflects the inclusion of TAO Group operating results, the absence of the loss related to the New York Spectacular and higher overall event-related results at our venues. This was partially offset by SG&A and other operating cost increases and to a lesser extent lower sponsorship and signage results. At MSG Sports, revenues of $80.9 million increased 14%. This was primarily due to higher lease redistribution, pre-season ticket-related revenue and local media rights fee from MSG network. The increase in pre-season ticket-related revenue was primarily due to one additional pre-season gains and higher average per game revenue, as compared to the prior year period. MSG Sports AOI of $25.8 million, increased by $10.4 million, this reflects the increase in revenues and to a lesser extent, lower direct operating expenses partially offset by an increase in SG&A expenses. The decrease in direct operating expenses was primarily due to lower net provisions for certain team personnel transactions, partially offset by higher team personnel compensation, other team operating expenses, and net provisions for NBA and NHL revenue sharing expense. Corporate and other adjusted operating loss of $14.6 million increased by $1.9 million, primarily due to higher employee compensation related benefits and to a lesser extent higher professional fees, mainly related to our business development initiatives. This was partially offset by management fee from TAO Group. Lastly, purchase accounting adjustments of $5.4 million reflected in operating expenses are primarily related to the TAO Group acquisition. Turning to our balance sheet, as if to September 30, total unrestricted cash and cash equivalents with approximately $1.2 billion. In addition there has been no borrowing made under either our $150 million New York Rangers revolving credit facility, or our $215 million dollars New York Knicks credit facility. As a reminder there also remains outstanding $110 million five-year term loan at the Tao Group level. In terms of the Company’s share repurchase program, this fiscal year through yesterday, we have repurchased approximately 44,000 shares for $9.3 million. Total repurchases under our current authorization now stands at 1.55 million shares for approximately $263 million, at an average price of about $170 per share. This amount represents 6% of total shares outstanding as of our spend date. With that I will now turn the call back over to Ari.

Thank you Donna. Christie can we open up the call for questions?

Sure. [Operator Instructions] And your first question comes from Brandon Ross of BTIG.

Hi good Morning guys. Thanks for taking the questions. Just a few months back we wrote a piece about a couple of different strategic possibilities for MSG. And there’s been some speculation in the market recently, I think, about each of them. So want to just directly ask about each thing. First of all, would you consider a sale or a minority investment in either the Knicks, or the Rangers, or both. And then secondly, and perhaps related, would you consider or are you considering a spinoff of the sports business or the teams for the entertainment business? And I have follow-up. Doc O’Connor: Okay. We continually review and evaluate all of our potential strategic options. Historically, that has led to spin offs, it’s led to acquisitions, it’s led to share repurchase programs. All of that said we have no current plans to spin off or sell the Knicks or the Rangers, or minority interests in either one of the entities. And we view them as important parts of our overall business. We’re not going to comment on any hypothetical transactions or scenarios on this call. We’ve consistently demonstrated over the years that we’re focused on creating long-term shareholder value and we’re going to continue to do so.

Great. And then just a follow-up. I think sponsorship was down in the quarter. Can you talk about why it was down and what the outlook is for the rest of the year? Doc O’Connor: I’m going to let Donna answer that one.

Sure. Well, in terms of the first quarter, first of all, as you know, I note that it’s the smallest quarter of the year. The Knicks and Rangers season have not really started. We were impacted this quarter by the timing of our contract renewal. And as Doc mentioned we are pleased to report that we have now renewed five of five of our signature partners and were excited about sided about the addition of our new signature marketing partner Squarespace. So I think we can – we are comfortable thing we expect another very solid year for our sponsorship in signage business.

Thank you.

Thank you. Your next question is from Michael Morris with Guggenheim.

Thank you. Good morning guys. A couple of questions. First, Doc you mentioned more information would be to come on your venue expansion strategy, but I’m hoping you could update us specifically on the plans in Las Vegas. Maybe how are you thinking about size, format what that market needs in terms of a venue and what the competitive opportunity is there? And then secondly, somewhat more broadly in light of a number of the tragic events that have happened over the past year, public events and the human element, which is important but putting aside just the business impact. How are you thinking about that? What type of impact do you see or would you anticipate on demand? And does it impact the cost side for things like increases in security or other factors, we’re not thinking of? Doc O’Connor: Okay, I’ll start with Vegas. As I said in our prepared remarks we’re close to completing our design plans for Las Vegas, I don’t have specifics on that and I expect to share more specifics with everyone in early calendar 2018. The first quarter of calendar year. If I can say that it will be a full scale venue. And with a lot of technology infusion that we will unveil at that time. We think that there’s a real opportunity in Las Vegas with a state-of-the-art, large scale, purpose-built venue for music and entertainment. And we think we can take what we did with the forum to a hold different level. Speaking of the Los Angeles market when we came in, we said this before, we saw potential for growth and invested in the forum, renovated and reopened. And since that time the LA market has grown 70% overall, with the forum accounting for most of that growth. Similarly, we look at Las Vegas as a fantastic market opportunity for us. T-Mobile has opened there and since opening that concert market has grown 80%, since that venue opened. That said, Las Vegas still represents only a market about half the size currently in terms of concerts as that of Los Angeles. So in other words content is coming to the region it’s just not coming at such scale as Las Vegas – so I mean as Los Angeles. So the point being that we think that we can effectively grow that market. Las Vegas itself is growing. There are major multi-million dollar developments happening across the city. There’s an additional 5,000 hotel rooms that are projected to go in by 2020. The Wynn company announced recently, Wynn Resorts Paradise Park, which is being built immediately adjacent to our property in Las Vegas. So we think that there’s tremendous growth opportunities in Vegas and we think that we can harvest those opportunities just as we did with the forum in Los Angeles and more. So I think that that largely answers your question on Las Vegas. With respect to security, we are very, very conscious of what’s going on out there in the world. And in light of recent events we’ve spent an enormous amount of time focused on the issue because the safety and security of our guests is our absolute number one priority. We’ve increased security measures and instituted new safety protocols across all of our venues both within the walls of the venues themselves, but in particular the common areas immediately adjacent to our venues and our perimeters. We’ve invested in a lot of technologies to enhance our security. And I’ll remind you that all of this has contributed to us being the first arena to be awarded the Safety Act designation, by the Department of Homeland Security. We have also beefed up our security personnel including the hiring of a new Head of Security who brings decades of security experience to our team. So we feel that we have been focused on this issue, and invested properly and keep monitoring the global situation in order to respond effectively with our security measures.

Great, thank you for the answers.

Thank you. Our next question is from John Janedis with Jefferies.

Thank you. A couple from me. One is talk about you’ve been prudent in avoiding the luxury tax over the last several years. How do you balance your commitment to achieve performance with cost management? Doc O’Connor: We’ve won a luxury tax payor in the last two seasons and we don’t project to be a luxury taxpayer this season, based on our current roster. But we’re not going to speculate on whether we will or we won’t be a tax payer going forward. We evaluated based on the idea that we’re committed to fielding championship caliber teams and building such. So we take all of those factors into account in figuring out the best long-term interest of the teams and the company.

Okay. And maybe separately, you touched on this, but with the Knicks jersey sponsorship deal with Squarespace last month, do you have any other large sponsorship opportunities? And is there any color you can give us on the expanded agreement with Delta? Doc O’Connor: Well I’ll take the Delta part. first. For Delta, specifically, first of all, we’re really pleased that we renewed it; it’s a 10-year deal. And it’s an expanded deal. They remain the official airline and private jet carrier for our New York venues and our sports teams. The Christmas Spectacular and the Boston calling music festival, they’ll continue to be the entitlement partner for the Delta Sky360 Club at MSG. And they receive permanent exposure across our sports assets and our outdoor signage at the Garden. One of the new elements or newer elements is that we’ll work together with Delta on a first class digital content platform, with pieces that are customized around the Knicks, and the Rangers in the Christmas Spectacular to amplify some of their key activations and extend the partnership reach beyond just simply our events. So we’re again really pleased with the Delta partnership. I think that when we – as your partnerships were established the conventional wisdom was that it was the transformation that was driving the value of these partnerships. I think we’ve proven over the long term, our – the value of our partners – partnerships to our partners. And we believe that we will only continue to extend on them. And the fact that we’ve gone five for five with our signature partner is a proof that it wasn’t the transformational alone driving this that we have long-term value with those partnerships. I believe I’ve answered your question.

Yes, thank you.

Your next question is from David Karnovsky with JP Morgan.

Hi, thank you. For the Christmas Spectacular, are you approaching this year’s run from a picketing your pricing strategy relative to last season? And given the new investment into the show, should we expect any change to the overall profitability? And then separately the New York Times had an article recently quoting sources that claim that New York Spectacular was no longer in the works for 2018. Can you give us an update on where you stand with that show? Thanks. Doc O’Connor: Yes. Starting with the Christmas Spectacular, so we constantly are revising and monitoring our ticket strategy based on current market data that we received. It’s early in the process, the show doesn’t premier for another two weeks. So it’s early yet in terms of ticket sales. But we’ve made significant investment in improving the customer journey through the sales process. And we’ve augment our ability to capture consumer data, as well, which results in us being able to deliver continuously improved performance with respect to ticket sales. So we’re very pleased with what has happened so far. But it’s still too early to say exactly what we can expect for this year’s Christmas Spectacular. On the New York Spectacular, as I said previously in earnings calls, we are revising this show. We are not going to continue with the New York Spectacular per se. We think that we have unique assets in the Rockettes, and Radio City Music Hall and unique experiences with both that we want to leverage in a more advantageous fashion. So we’re exploring the creation of a streamlined show that leverages the technology that we referenced in our prepared remarks. And that creates a more immersed experience of experiencing that show. What we plan to do with the second show is to create one that’s more nimble, that we can actually play over a longer period of time, but that can come in and out of the hall easily. And not take up big consecutive blocks of dates. This would allow us to market the Rockettes and Radio City Music Hall in a year around fashion and it would allow us to opportunistically book the hall with premium entertainment and residencies, as we did with Dave Chappelle in that 16 show run. So we are intending to create a show that will allow people to experience both Radio City Music Hall and the incredible talent of the Rockettes. And our intention to do so we’re in the planning phases of this, we have nothing specific to report as to the concept of the show, or the size and scale of the show, or the schedule of the show at this moment in time, but we will when we’re prepared to do so.

Thanks for the questions David. Christy will take the next caller.

Your your next question comes from Bryan Goldberg with Bank of America.

Thanks. I had a question on your JVs, namely as often Tribeca. And I’m asking in the context of if I’m reading your P&L correctly your share of the net income that you recognize on the P&L looks like it was up nicely year-over-year in the quarter. And I guess wondering what’s driving that, is this a onetime event or is this type of growth sustainable? Any color you could provide would be appreciated. Thanks. Doc O’Connor: Well I’ll take that general part of that question and then turned the financial part over to Donna. We’re particularly pleased with Oak View Group and Tim Leiweke’s Enterprise in terms of the success – the early success that they’ve had and the momentum they have with several of their initiatives. And Tim and Irving with respect to leadership of that entity are forces to be reckoned with and are building a great business. Likewise with the Global Music Rights business, success has been excellent there. So we’re very, very happy with the performance of the various Azoff assets under that umbrella. With respect to the financials I’ll turn it over to Donna.

Hi. Yes, first of all, I’m pleased to say you are reading our P&L correctly. And we were happy to see a net improvement in earnings reported from our Azoff MSG Entertainment and Tribeca Enterprises businesses. There is a very small piece that’s not becoming. So I think this reflects as Doc discussed the deal [ph] how the business is doing.

Thank you very much.

Your next question is from David Miller with Loop Capital Market.

Yes hey guys congratulations on stellar results. Doc on TAO, I just want to make sure I have it straight, how many U.S. locations have you opened since the closure of the deal which was February? And how many do you have set to open next year? I just want to have that straight. Then also related to TAO, it feels like you guys are taking advantage of synergies here myriad of cross-promotional opportunities, ticketing, sponsorship, advertising to a captive audience. Do you feel like there’s any more wood to chop in terms of creating additional synergies beyond that? Appreciated it? Thanks. Doc O’Connor: On the first part of your question I believe the answer is six, five in Los Angeles in the MOXY Times Square venues. And in terms of the performance of those venues, the TAO Group is very, very pleased with those results. That was a rollout of new venues in Los Angeles, but now five are fully operational and up and running and doing quite well. And MOXY has had an excellent opening as well. And I think they’ve succeeded in creating significant buzz with all of those openings. I’m sorry the second part of your question was – what it was?

Well yes, I just want to make sure that like you guys feel like there’s more wood to chop in terms of creating synergies out of TAO, or do you feel like you’ve completely integrated into your model as of now? And your – it’s all – it’s rich running on all eight cylinders. Doc O’Connor: Oh no, we’re just at the very beginning in terms of integration and we’re very, very pleased with the initial results. We’ve talked about what we’re now calling hospitality partnerships, we have one model now. And the size, and scale and term of these deals is akin to our signature marketing partnerships with the company. So that’s significant revenue, and significant synergies and we think it provides a model that can be expanded on with other Fortune 500 companies, that spend enormous amounts of money in entertainment and hospitality. So that’s one example. Suite Sixteen is another hospitality innovation that has resulted from this new partnership. It is a members-only lounge at Madison Square Garden that provide really innovative hospitality options and amenities that haven’t existed before in a major sports and entertainment venue. And we think that as we said from the very beginning with TAO, that these guys have an expertise in the premium experience unlike any others. And we intend to bring that expertise not only to our existing venue list as you’re seeing, but with integration into our venue expansion which again we will be happy to elaborate upon in calendar 2018, early calendar 2018.

Okay, wonderful, thank you.

Thanks David. Christy we have time for one last caller.

Thank you. Your final question is from David Joyce with Evercore-ISI.

Thank you. And thinking about your incremental rights monetization opportunities and in light of some of the big Internet platforms trying to insert themselves into some of the other professional sports rights or sports leagues, are there opportunities for you on this front across your properties? And then maybe more broadly where should we think about other ways that you could be monetizing your rights? Doc O’Connor: Are you specifically referring to our sports rights?

That’s primarily what I would be considering, yes. Doc O’Connor: Well, we have long-term local media rights agreements in place with the networks, with the Knicks and Rangers. And the revenues from those agreements are in excess of $135 million dollars a year and growing over the term. But the local digital rights for both teams are part of these agreements. So there’s no additional local media rights revenue opportunities for us to monetize. But with the acquisition of CLG and the growing esports category, the opportunities for monetizing those right digitally are there and apparent. And with our expertise in media rights, particularly in the sports space that we’ve had over decades at this company, we plan to aggressively pursue those opportunities with CLG and the esports category.

Great, thank you.

Thank you. With that I’ll turn the call back over to Ari Danes for any additional or closing remarks.

Thank you all for joining us and have a good day.

Thank you. This does conclude today’s conference call, you may now disconnect.