Live Nation Reports the Concert Business is Healthy With Robust Performance for Second Quarter 2008

Live Nation Reports the Concert Business is Healthy With Robust Performance for Second Quarter 2008

- Number of live concerts produced in the second quarter of 2008 up 42% over last year -

- Total attendance at these concerts increased 14% as compared to 2007 -

- Total revenue per fan attending our concerts increased 6% over prior year -

LOS ANGELES, Aug. 7 /PRNewswire-FirstCall/ -- Live Nation (NYSE:LYV) released financial results for the three months ended June 30, 2008 today.

(Logo: http://www.newscom.com/cgi-bin/prnh/20070220/LATU096LOGO)

Quarterly Summary Results
$ in millions (except per share amounts)

Q2 2008 Q2 2007

Revenue $1,159.8 $986.3

Adjusted Operating Income $58.4 $40.6

Operating Income $23.7 $32.2

Free Cash Flow $25.7 $1.5

Net Income $1.2 $9.9

Basic and Diluted EPS $0.02 $0.15

"The concert environment remains strong and the fundamentals of our core business continue to improve," said Michael Rapino, President and Chief Executive Officer of Live Nation. "Despite the economy, our business achieved growth during the quarter in the number of concerts, ticket sales and the per fan revenue/spend. We have two priorities in 2008 -- to continue to grow our concert business and to prepare to vertically expand into the ticketing business. Our core business is buying and producing concert rights and monetizing the live experience through our distribution pipe. We were successful in growing both. We believe we are on plan to launch our ticketing operation on January 1st, 2009, which will complete our connection to the fan and transform Live Nation into the only music company that is vertically integrated from artist to fan as a direct distributor."

Highlights:
-- Expanded our global festival footprint to 30 after acquiring a
controlling interest in France's Main Square festival, which will serve
as a strong base from which to launch additional festivals in France,
the fifth largest music market in the world.
-- Successfully launched Pemberton festival, which drew a full capacity of
over 40,000 people in attendance and was the first festival where we
handled ticketing, website, merchandise and creative services in
addition to promoting the event.
-- Provided services through our Artist Nation segment to a total of 895
artists during the first six months of 2008. In addition, we reached
agreements to acquire long-term rights for Nickelback and Shakira.

Below are what we believe to be our key metrics related to our businesses:

METRICS

(Unaudited; $ in millions except as noted)

Variance 6 months 6 months Variance
Key Drivers Q2 2008 Q2 2007 (Qtr.) 2008 2007 (YTD)

Rights Acquisitions -- Global Music Businesses
Talent Costs and
Other Event Direct
Operating Expenses $902.4 $746.2 20.9% $1,293.1 $1,026.8 25.9%
Talent and Other
Event Expenses as
% of Total Revenue 80.4% 80.2% 79.8% 78.6%
Number of Live Rights
(Concerts) (est.) 5,848 4,134 41.5% 10,354 7,387 40.2%
Number of Ancillary
Live Rights - as of
date (est.) 895 n/a n/a 895 n/a n/a
Revenue Recognized
for Artists Services
/Ancillary Live
Rights $53.4 n/a n/a $89.2 n/a n/a

Distribution Platform -- Global Music Businesses
Total Attendance
(est.) 13,655,000 12,004,000 13.8% 21,716,000 18,113,000 19.9%
International
Music Festival
Attendance (est.) 284,000 501,000 (43.3%) 284,000 501,000 (43.3%)
Ancillary Revenue
per Attendee - NA
Music Amps only $17.46 $17.00 2.7% $17.45 $17.18 1.6%
Total Revenue per
Attendee (Fan) $82.18 $77.51 6.0% $74.65 $72.11 3.5%

Sponsorship Data -- Global Music and Ticketing Businesses
Number of Sponsors
- as of date (est.) 623 747 (16.6%) 623 747 (16.6%)
Sponsorship Revenue
Recognized $44.7 $49.9 (10.4%) $62.2 $68.2 (8.8%)
Average Sponsorship
Revenue per Sponsor
(rounded,
whole $) $72,000 $67,000 7.5% $100,000 $91,000 9.9%

FINANCIAL HIGHLIGHTS -- 2nd QUARTER

Q2 2008 Q2 2007 Growth
$ in millions
Revenue
North American Music $619.7 $466.6 32.8%
International Music 377.2 335.2 12.5%
Artist Nation 125.3 128.6 (2.6%)
Ticketing 7.3 2.9 151.7%
Other and Eliminations 30.3 53.0 (42.8%)
$1,159.8 $986.3 17.6%

Adjusted Operating Income Margins
(Loss) Q2 2008 Q2 2007
North American Music $50.6 $14.9 239.6% 8.2% 3.2%
International Music 25.4 30.0 (15.3%) 6.7% 8.9%
Artist Nation (3.3) 1.5 ** (2.6%) 1.2%
Ticketing (2.7) (1.1) ** (37.0%) (37.9%)
Other and Eliminations (1.1) 2.6 ** (3.6%) 4.9%
Corporate (10.5) (7.3) (43.8%)
$58.4 $40.6 43.8% 5.0% 4.1%

Operating Income (Loss)
North American Music $35.4 $7.1 398.6% 5.7% 1.5%
International Music 19.7 39.2 (49.7%) 5.2% 11.7%
Artist Nation (13.5) (1.8) ** (10.8%) (1.4%)
Ticketing (4.3) (1.8) ** (58.9%) (62.1%)
Other and Eliminations (2.3) - ** (7.6%) 0.0%
Corporate (11.3) (10.5) (7.6%)
$23.7 $32.2 (26.4%) 2.0% 3.3%

** percentages are not meaningful

The highlights of our financial information for the second quarter of 2008 as compared to the second quarter of 2007 are as follows:

Revenue change -- Total increase of $173.5 million, primarily driven by:
-- $95.1 million -- Strong amphitheater and arena events in North American
Music driven by increased events, attendance and higher ticket prices.
-- $58.0 million -- Acquisition of HOB Canada in North American Music.
-- $28.6 million -- Acquisitions of AMG, DF Concerts and Heineken Music
Hall in International Music.
-- ($19.2) million -- Decline in International Music due to the timing of
festivals in Belgium and the United Kingdom, reduced ticket sales for
the Download festival and The Point closure in Ireland partially offset
by stronger promotion activity in the United Kingdom and Italy.
-- $37.3 million -- Acquisitions of Signatures and Anthill in Artist
Nation (previously referred to as Global Artists).
-- ($40.5) million -- Decline in the volume of global tours during the
quarter impacted Artist Nation.
-- $37.2 million -- Foreign exchange movements, primarily in International
Music.

Adjusted Operating Income (Loss) change -- Total improvement of $17.8 million, primarily driven by:

-- $5.7 million -- Acquisitions of HOB Canada in North American Music, AMG
and Heineken Music Hall in International Music and Signatures and
Anthill in Artist Nation.
-- $34.9 million -- Improvement in North American Music operating results
driven by strong amphitheater and arena results due to increased events
and attendance and also a $10.1 million reduction in selling, general
and administrative expenses related to legal and other cost reductions.
-- ($8.1) million -- Decline in International Music primarily due to
timing of festivals and The Point closure.
-- ($6.2) million -- Timing of global tours and increased salary and
consulting expenses related to building infrastructure for Artist
Nation.
-- ($3.7) million -- Decline in other operations primarily due to a $6.4
million reduction in our Events division driven by underperforming
non-music touring productions based on low event results and high
production costs.

Operating Income (Loss) change -- Total decrease of $8.5 million, primarily driven by:

-- $17.8 million -- Overall improvement in Adjusted Operating Income
(Loss) noted above.
-- ($8.9) million -- Increase in depreciation and amortization expense due
primarily to $5.1 million increase in Artist Nation for amortization of
intangible assets related to the CPI acquisition and artist rights
agreements.
-- ($18.4) million -- Decreased gain on sale of operating assets primarily
due to gains recorded in 2007 on the sale of an amphitheater in
Nashville, an office building in San Francisco and two mid-sized music
venues in London, partially offset by a loss in 2007 on a non-core
asset.

Other Information --
-- We continue to expand our sponsorship relationships with key companies
across the world such as Citi, Wrigley, MBNA, O2 and Verizon. By
expanding into more strategic partnerships, we have eliminated
lower-value agreements, reducing our overall number of sponsors but
increasing our average sponsorship dollars per sponsor. For the second
quarter of 2008, our average sponsorship revenue dollar per sponsor
increased by 8%. For the full-year of 2008, we currently expect that
our total sponsorship revenue will increase over 2007.

FINANCIAL HIGHLIGHTS -- SIX MONTHS ENDED JUNE 30

6 months 6 months
2008 2007 Growth
$ in millions
Revenue
North American Music $919.8 $714.9 28.7%
International Music 506.1 439.8 15.1%
Artist Nation 195.2 151.4 28.9%
Ticketing 13.0 4.2 **
Other and Eliminations 162.2 196.3 (17.4%)
$1,796.3 $1,506.6 19.2%

Margins
Adjusted Operating Income 6 months 6 months
(Loss) 2008 2007
North American Music $33.8 $(4.1) ** 3.7% (0.6%)
International Music 26.5 30.6 (13.4%) 5.2% 7.0%
Artist Nation (12.5) (3.2) ** (6.4%) (2.1%)
Ticketing (6.0) (2.9) ** (46.2%) (69.0%)
Other and Eliminations 34.3 33.4 2.7% 21.1% 17.0%
Corporate (19.7) (15.9) (23.9%)
$56.4 $37.9 48.8% 3.1% 2.5%

Operating Income (Loss)
North American Music $2.9 $(26.5) ** 0.3% (3.7%)
International Music 12.7 35.3 (64.0%) 2.5% 8.0%
Artist Nation (31.3) (10.5) ** (16.0%) (6.9%)
Ticketing (8.2) (4.3) (90.7%) (63.1%) **
Other and Eliminations 33.6 22.9 46.7% 20.7% 11.7%
Corporate (24.5) (21.5) (14.0%)
$(14.8) $(4.6) ** (0.8%) (0.3%)

** percentages are not meaningful

The highlights of our financial information for the six-month period ended June 30, 2008 as compared to the same period in 2007 are as follows:

Revenue change -- Total increase of $289.7 million, primarily driven by:
-- $94.9 million -- Acquisition of HOB Canada in North American Music.
-- $110.0 million -- Increase in North American Music primarily due to
strong results from arena tours and an increase in events, attendance
and average ticket prices at our owned and/or operated amphitheaters
and third-party venues.
-- $44.7 million -- Acquisitions of AMG, Heineken Music Hall and DF
Concerts in International Music.
-- ($21.8) million -- Decline in International Music due to the timing of
festivals in Belgium and the United Kingdom, reduced revenues for the
Download festival in the United Kingdom, closure of The Point in
Ireland for renovation and lower promotion-related revenues in Holland
and France. These declines in revenue were partially offset by
increased promotion revenue in the United Kingdom and Italy due to
strong stadium events.
-- $61.6 million -- Acquisitions of Signatures and Anthill in Artist
Nation.
-- ($17.8) million -- Decline in the volume of global tours impacted
Artist Nation.
-- ($17.6) million -- Reduced revenue due to our sale of a non-core
production in the first quarter of 2007 and fewer productions and
touring shows in our United Kingdom theatrical operations, reported in
"other operations".
-- $54.1 million -- Foreign exchange movements, primarily in International
Music.

-- Adjusted Operating Income (Loss) change -- Total improvement of $18.5 million, primarily driven by:

-- $9.9 million -- Acquisitions of HOB Canada in North American Music, AMG
and Heineken Music Hall in International Music and Signatures and
Anthill in Artist Nation.
-- $36.2 million -- Increase in North American Music primarily due to
strong results from arena tours and an increase in events and
attendance at our owned and/or operated amphitheaters and third-party
venues, in addition to an $11.3 million reduction in selling, general
and administrative expenses related to legal and other cost reductions.
-- ($11.5) million -- Decline in International Music due to timing of
festival event days and closure of The Point in Ireland. These
declines were partially offset by increased promotion activity in the
United Kingdom due to strong stadium events.
-- ($10.1) million -- Reduced volume in global tours and increased salary
and consulting expenses related to building infrastructure for Artist
Nation.
-- ($3.1) million -- Increased costs to build our infrastructure in
Ticketing (previously referred to as Global Digital).
-- $0.9 million -- Other operations increased slightly primarily due to
improved results in our Motor Sports division based on an increase in
events offset by an $8.5 million reduction in our Events division
driven by underperforming non-music touring productions based on low
event results and high production costs.

Operating Income (Loss) change -- Total decrease of $10.2 million, primarily driven by:

-- $18.5 million -- Overall improvement in Adjusted Operating Income
(Loss) noted above.
-- ($16.2) million -- Increase in depreciation and amortization expense
due primarily to increases in our Artist Nation and International Music
segments of $10.3 million and $4.8 million, respectively, due to
amortization of intangible assets for the AMG and CPI acquisitions
along with intangible assets related to artist rights agreements.
-- ($12.4) million -- Decreased gain on sale of operating assets compared
to the same period of the prior year primarily due to gains recorded in
2007 on the sale of an amphitheater in Nashville, two mid-sized music
venues in London and two non-core assets.

Other information
-- For the six months ended June 30, 2008, maintenance capital
expenditures were $19.0 million, a slight decrease as compared to last
year. We also incurred $57.1 million of capital expenditures for
revenue generating projects during the six-month period ended June 30,
2008 due to the development and renovation of various venues including
The Point in Ireland, two House of Blues clubs and a new AMG venue in
Sheffield, England.
-- As of June 30, 2008, our cash and cash equivalents were $453.4 million
and our total long-term debt was $794.1 million with no balance
outstanding on our revolving credit facility. Free cash as of June 30,
2008 was ($83.1) million.

About Live Nation:

Live Nation is the future of the music business. With the most live concerts, music venues and festivals in the world and the most comprehensive concert search engine on the web, Live Nation is revolutionizing the music industry: onstage and online. Headquartered in Los Angeles, California, Live Nation is listed on the New York Stock Exchange, trading under the symbol "LYV".

Conference Call:

The company will host a teleconference today, August 7th, 2008 at 5:00 p.m. Eastern Time, which can be accessed by dialing 888-603-6873 (U.S.) or 973-321-1019 (Int'l) and referencing passcode 57200043. To access the call via webcast, please visit the Investor Relations section of the company's website at http://www.livenation.com/investors. Additional statistical and financial information to be provided on the call, if any, will be posted supplementally under that same link.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
(in thousands except share and per share data)
Revenue $1,159,800 $986,277 $1,796,251 $1,506,589
Operating expenses:
Direct operating expenses 920,200 776,262 1,388,882 1,149,551
Selling, general and
administrative expenses 173,098 163,442 334,714 305,909
Depreciation and
amortization 33,223 24,347 67,600 51,409
Gain on sale of operating
assets (916) (19,269) (2,291) (14,694)
Corporate expenses 10,474 9,263 22,115 19,059

Operating income (loss) 23,721 32,232 (14,769) (4,645)
Interest expense 14,434 15,248 30,361 30,176
Interest income (3,266) (4,290) (4,841) (6,927)
Equity in losses (earnings)
of nonconsolidated affiliates 1,136 (2,875) 1,425 (3,218)
Minority interest expense
(income) (2,241) 3,520 (4,483) 525
Other income -- net (264) (307) (1,115) (354)

Income (loss) from continuing
operations before income
taxes 13,922 20,936 (36,116) (24,847)
Income tax expense:
Current 9,907 14,468 13,215 16,665
Deferred 2,641 485 5,662 4,189

Income (loss) from continuing
operations 1,374 5,983 (54,993) (45,701)
Income (loss) from
discontinued operations,
net of tax (139) 3,939 20,826 10,574

Net income (loss) 1,235 9,922 (34,167) (35,127)
Other comprehensive income,
net of tax 1,452 9,986 11,888 9,483

Comprehensive income (loss) $2,687 $19,908 $(22,279) $(25,644)

Basic income (loss) per
common share:
Income (loss) from continuing
operations $0.02 $0.09 $(0.73) $(0.70)
Income from discontinued
operations -- 0.06 0.28 0.16

Net income (loss) $0.02 $0.15 $(0.45) $(0.54)

Diluted income (loss)
per common share:
Income (loss) from continuing
operations $0.02 $0.09 $(0.73) $(0.70)
Income from discontinued
operations -- 0.06 0.28 0.16

Net income (loss) $0.02 $0.15 $(0.45) $(0.54)

Weighted average common
shares outstanding:
Basic 75,720,739 65,521,804 75,352,837 65,510,822
Diluted 76,898,595 67,702,746 75,352,837 65,510,822

CONSOLIDATED BALANCE SHEETS

June 30, December 31,
2008 2007
(unaudited) (audited)
ASSETS (in thousands)
CURRENT ASSETS
Cash and cash equivalents $453,368 $338,991
Accounts receivable, less allowance of
$12,531 as of June 30, 2008 and $18,928 as
of December 31, 2007 384,292 264,316
Prepaid expenses 377,460 186,379
Other current assets 58,484 44,722

Total Current Assets 1,273,604 834,408
PROPERTY, PLANT AND EQUIPMENT
Land, buildings and improvements 965,333 1,018,079
Furniture and other equipment 243,576 236,320
Construction in progress 102,541 51,725
1,311,450 1,306,124
Less accumulated depreciation 405,140 391,079

906,310 915,045
INTANGIBLE ASSETS
Intangible assets -- net 511,892 382,999
Goodwill 502,206 471,542
OTHER LONG-TERM ASSETS
Notes receivable, less allowance of $745 as
of June 30, 2008 and December 31, 2007 1,589 1,703
Investments in nonconsolidated affiliates 22,915 23,443
Other long-term assets 141,029 122,963

Total Assets $3,359,545 $2,752,103

LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $122,813 $79,273
Accrued expenses 471,341 511,636
Deferred revenue 782,300 259,868
Current portion of long-term debt 67,184 36,345
Other current liabilities 78,149 18,348

Total Current Liabilities 1,521,787 905,470
Long-term debt 726,898 786,261
Other long-term liabilities 139,138 91,465
Minority interest liability 72,309 61,841
Series A and Series B redeemable preferred stock 40,000 40,000
Commitments and contingent liabilities
SHAREHOLDERS' EQUITY
Common stock 761 749
Additional paid-in capital 959,090 940,848
Retained deficit (165,108) (130,941)
Cost of shares held in treasury (3,628) -
Accumulated other comprehensive income 68,298 56,410

Total Shareholders' Equity 859,413 867,066

Total Liabilities and Shareholders' Equity $3,359,545 $2,752,103

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Six Months Ended
June 30,
2008 2007
(in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(34,167) $(35,127)
Reconciling items:
Depreciation 37,914 39,117
Amortization of intangibles 29,853 13,596
Deferred income tax expense 5,662 4,121
Amortization of debt issuance costs 1,630 618
Non-cash compensation expense 5,864 5,799
Gain on sale of operating assets (21,117) (14,806)
Gain on sale of other investments - (64)
Equity in losses (earnings) of nonconsolidated
affiliates 1,425 (3,218)
Minority interest expense (income) (4,467) 427
Changes in operating assets and liabilities, net of
effects of acquisitions and dispositions:
Increase in accounts receivable (100,290) (152,759)
Increase in prepaid expenses (177,960) (217,800)
Increase in other assets (55,857) (43,698)
Increase in accounts payable, accrued expenses
and other liabilities 33,261 90,429
Increase in deferred revenue 530,607 528,341
Decrease in other -- net 43 -

Net cash provided by operating activities 252,401 214,976
CASH FLOWS FROM INVESTING ACTIVITIES
Collection of notes receivable 88 1,857
Advances to notes receivable - (12,880)
Distributions from nonconsolidated affiliates 3,799 5,956
Investments made to nonconsolidated affiliates (250) (23,890)
Proceeds from disposal of other investments - 3,616
Purchases of property, plant and equipment (76,082) (39,462)
Proceeds from disposal of operating assets, net
of cash divested 23,127 60,195
Cash paid for acquisitions, net of cash acquired (65,454) (25,316)
Purchases of intangible assets (5,981) -
Decrease (increase) in other net (4) 417

Net cash used in investing activities (120,757) (29,507)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt, net of debt issuance
costs 52,887 87,051
Payments on long-term debt (81,945) (118,765)
Contributions from minority interest partners 8,847 -
Distributions to minority interest partners (402) (4,020)
Proceeds from exercise of stock options - 424
Payments for purchases of common stock (3,628) -

Net cash used in financing activities (24,241) (35,310)
Effect of exchange rate changes on cash 6,974 2,622
Net increase in cash and cash equivalents 114,377 152,781
Cash and cash equivalents at beginning of period 338,991 313,880
Cash and cash equivalents at end of period $453,368 $466,661

Forward Looking Statements, Non-GAAP Financial Measures and Reconciliations:

Certain statements in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements regarding the potential health and growth of Live Nation's business and the live music industry generally in 2008; the company's anticipated achievement of its strategic objectives; the company's intention to launch its ticketing operations and the anticipated benefits of its ticketing strategy; and the company's anticipated growth in total sponsorship revenue for 2008. Live Nation wishes to caution you that there are some known and unknown factors that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements, including but not limited to operational challenges in achieving strategic objectives and executing on the company's plans, the risk that the company's markets do not evolve as anticipated, the potential impact of any general economic slowdown, operational challenges associated with building out the company's ticketing operations and competition for corporate sponsors and in the live music industry generally.

Live Nation refers you to the documents it files from time to time with the U.S. Securities and Exchange Commission, specifically the section titled "Item 1A. Risk Factors" of the company's most recent Annual Report filed on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, which contain and identify other important factors that could cause actual results to differ materially from those contained in the company's projections or forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date on which they are made. All subsequent written and oral forward-looking statements by or concerning Live Nation are expressly qualified in their entirety by the cautionary statements above. Live Nation does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise.

This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. A reconciliation of each such measure to its most directly comparable GAAP financial measure, together with an explanation of why management believes that these non-GAAP financial measures provide useful information to investors, is provided below.

Adjusted Operating Income (Loss) is a non-GAAP financial measure that the company defines as operating income (loss) before depreciation and amortization, loss (gain) on sale of operating assets and non-cash compensation expense. The company uses Adjusted Operating Income (Loss) to evaluate the performance of its operating segments. The company believes that information about Adjusted Operating Income (Loss) assists investors by allowing them to evaluate changes in the operating results of the company's portfolio of businesses separate from non-operational factors that affect net income, thus providing insights into both operations and the other factors that affect reported results. Adjusted Operating Income (Loss) is not calculated or presented in accordance with U.S. generally accepted accounting principles. A limitation of the use of Adjusted Operating Income (Loss) as a performance measure is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenue in the company's business. Accordingly, Adjusted Operating Income (Loss) should be considered in addition to, and not as a substitute for, operating income (loss), net income (loss), and other measures of financial performance reported in accordance with U.S. GAAP. Furthermore, this measure may vary among other companies; thus, Adjusted Operating Income (Loss) as presented herein may not be comparable to similarly titled measures of other companies.

Free Cash Flow is a non-GAAP financial measure that the company defines as Adjusted Operating Income (Loss) less maintenance capital expenditures, less net interest expense, less cash taxes, less distributions to minority interest partners plus distributions from investments in nonconsolidated affiliates net of contributions to investments in nonconsolidated affiliates. The company uses free cash flow, among other measures, to evaluate the ability of its operations to generate cash that is available for purposes other than maintenance capital expenditures. The company believes that information about free cash flow provides investors with an important perspective on the cash available to service debt and make acquisitions. Free cash flow is not calculated or presented in accordance with U.S. generally accepted accounting principles. A limitation of the use of free cash flow as a performance measure is that it does not necessarily represent funds available for operations and it is not necessarily a measure of our ability to fund our cash needs. Accordingly, free cash flow should be considered in addition to, and not as a substitute for, operating income (loss) and other measures of financial performance reported in accordance with U.S. GAAP. Furthermore, this measure may vary among other companies; thus, free cash flow as presented above may not be comparable to similarly titled measures of other companies.

Free Cash is a non-GAAP financial measure that the company defines as cash and cash equivalents less event-related deferred income, less accrued artist fees, less collections on behalf of others plus prepaids related to artist settlements/events. The company uses free cash as a proxy for how much cash it has available to, among other things, optionally repay debt balances, make acquisitions and finance new venue expenditures. Free cash is not calculated or presented in accordance with U.S. generally accepted accounting principles. A limitation of the use of free cash as a performance measure is that it does not necessarily represent funds available for operations and it is not necessarily a measure of our ability to fund our cash needs. Accordingly, free cash should be considered in addition to, and not as a substitute for, cash and cash equivalents and other measures of financial performance reported in accordance with U.S. GAAP. Furthermore, this measure may vary among other companies; thus, free cash as presented herein may not be comparable to similarly titled measures of other companies.

Reconciliations of Non-GAAP Measures to Their Most Directly Comparable GAAP

Measures (Unaudited)

Reconciliation of Adjusted Operating Income (Loss) to Operating
Income (Loss) -- Second Quarter and Six Months ended June 30

Loss
Adjusted (gain) on
operating Non-cash sale of Depreciation Operating
income compensation operating and income
(loss) expense assets amortization (loss)
($ in millions)
For the three months ended June 30, 2008

North American
Music $50.6 $0.2 $ - $15.0 $35.4
International
Music 25.4 - - 5.7 19.7
Artist Nation (3.3) 2.2 - 8.0 (13.5)
Ticketing (2.7) - - 1.6 (4.3)
Other and
Eliminations (1.1) - (1.0) 2.2 (2.3)
Corporate (10.5) - 0.1 0.7 (11.3)
Total Live
Nation $58.4 $2.4 $(0.9) $33.2 $23.7

For the three months ended June 30, 2007

North American
Music $14.9 $0.8 $(6.1) $13.1 $7.1
International
Music 30.0 0.1 (13.0) 3.7 39.2
Artist Nation 1.5 0.4 - 2.9 (1.8)
Ticketing (1.1) 0.2 - 0.5 (1.8)
Other and
Eliminations 2.6 - (0.2) 2.8 -
Corporate (7.3) 1.9 - 1.3 (10.5)
Total Live
Nation $40.6 $3.4 $(19.3) $24.3 $32.2

For the six months ended June 30, 2008

North American
Music $33.8 $1.7 $ - $29.2 $2.9
International
Music 26.5 0.6 - 13.2 12.7
Artist Nation (12.5) 1.9 - 16.9 (31.3)
Ticketing (6.0) 0.2 - 2.0 (8.2)
Other and
Eliminations 34.3 (0.9) (2.9) 4.5 33.6
Corporate (19.7) 2.4 0.6 1.8 (24.5)
Total Live
Nation $56.4 $5.9 $(2.3) $67.6 $(14.8)

For the six months ended June 30, 2007

North American
Music $(4.1) $1.6 $(6.1) $26.9 $(26.5)
International
Music 30.6 0.1 (13.1) 8.3 35.3
Artist Nation (3.2) 0.7 - 6.6 (10.5)
Ticketing (2.9) 0.3 - 1.1 (4.3)
Other and
Eliminations 33.4 - 4.5 6.0 22.9
Corporate (15.9) 3.1 - 2.5 (21.5)
Total Live
Nation $37.9 $5.8 $(14.7) $51.4 $(4.6)

Reconciliation of Adjusted Operating Income (Loss) to Free Cash Flow --
Second Quarter

($ in millions) Q2 2008 Q2 2007
Adjusted operating income $58.4 $40.6
Less: Interest expense -- net (11.2) (10.8)
Cash taxes (9.9) (14.9)
Maintenance capital expenditures (12.8) (13.9)
Distributions to minority interest partners (0.2) (1.2)
Distributions from (contributions to) investments
in nonconsolidated affiliates 1.4 1.7
Free cash flow $25.7 $1.5

Reconciliation of Cash and Cash Equivalents to Free Cash as of June 30, 2008

($ in millions) June 30, 2008
Cash and cash equivalents $453.4
Deferred income $(689.5)
Accrued artist fees $(30.0)
Collections on behalf of others $(88.8)
Prepaids related to artist settlements/events $271.8
Free cash $(83.1)

First Call Analyst:
FCMN Contact:

Photo: http://www.newscom.com/cgi-bin/prnh/20070220/LATU096LOGO
AP Archive: http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com
Source: Live Nation

CONTACT: Media, John Vlautin of Live Nation, +1-310-867-7000; or
Investors, Brad Edwards of Brainerd Communicators, Inc., +1-212-986-6667, for
Live Nation

Web site: http://www.livenation.com/

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Profile: intent