Live Nation Reports Strong Third Quarter 2009 Results

Live Nation Reports Strong Third Quarter 2009 Results

- Revenue growth of 14% to $1.8 billion driven by a 12% increase in attendance - - Income from continuing operations before taxes growth of 53% to $96 million - - Free Cash Flow nearly doubles to $123 million -

LOS ANGELES, Nov. 9 /PRNewswire-FirstCall/ -- Live Nation (NYSE:LYV) released financial results for the three months ended September 30, 2009 today.

(Logo: http://www.newscom.com/cgi-bin/prnh/20081203/LAW048LOGO-b)

Quarterly Summary Results
Unaudited; $ in millions

Q3 2009 Q3 2008
------- -------

Revenue $1,808.3 $1,588.5

Adjusted Operating Income $160.8 $109.5

Operating Income $114.8 $75.5

Free Cash Flow $123.2 $64.4

"We generated robust organic growth from our operations during the third quarter as we focused on executing our fundamentals with excellence during the peak concert season," said Michael Rapino, President and Chief Executive Officer of Live Nation. "Our dedication to driving efficiencies across our core operations helped drive solid free cash flow of $123 million in the third quarter as we continue to focus on reducing our overall leverage. Our ability to generate strong attendance growth of 12% despite the worst economic climate in decades speaks to the strength of our concert platform and our ongoing focus on improving how we promote, price and distribute live music products to millions of fans globally."

"The launch of our new e-commerce ticketing site has allowed us to start vertically integrating into a high-growth sector and improve our core business of selling more tickets directly to fans," Rapino continued. "There is more that we want to do, but Livenation.com is already a highly ranked music destination attracting millions of fans daily, seeking tickets and information on their favorite concerts. Despite a challenging advertising environment, we have also grown our sponsorship revenue by almost 5% year-to-date which illustrates our ability to connect brands, concerts and music fans. With these growth levers, along with our disciplined approach to cost management, we believe that we are well-positioned to deliver healthy gains in our annual cash flows with a priority on reducing our long-term debt and strengthening our balance sheet."

Highlights:

-- Recently completed the sale of our remaining U.K. theater assets, in
two transactions, for aggregate gross sales proceeds of approximately
$160 million. Half of the net proceeds, currently estimated at
approximately $111 million, will be applied as a permanent reduction
in our term loans.
-- Through our LiveNation.com network, we have sold 10.6 million tickets
globally since the beginning of 2009, including 3.0 million tickets
sold in the third quarter of 2009. This total for the year includes
1.7 million tickets sold internationally.
-- We had continued success with our "No Service Fee Wednesday"
promotion, selling over 816,000 tickets in North America through this
program during 2009.
-- Our LiveNation.com network was ranked 5th by Nielsen NetView among the
most-visited domestic music websites, with 5.0 million unique visitors
in the month of July. Traffic to our website has increased by over
55% in the first nine months of the year as compared to last year.
-- Reported revenue of $1.8 billion for the third quarter reflects an
increase of $220 million over the third quarter of 2008. Revenue on a
constant currency basis was up 19% over the prior year.
-- Sponsorship revenue totaled $78.5 million during the third quarter, an
increase of 4.4% over the prior year. In October 2009, Live Nation
formed a multi-year strategic sponsorship and marketing alliance with
Coca-Cola that leverages the company's artist-to-fan distribution
platform.
-- Income from continuing operations for the third quarter was $79.2
million as compared to $30.7 million in 2008, after adjusting 2008 for
the tax benefit of $64.1 million recorded in continuing operations
related to discontinued operations. For the first nine months of
2009, the loss from continuing operations was ($50.8) million as
compared to ($59.6) million in 2008, after adjusting 2008 for the tax
benefit of $83.1 million recorded in continuing operations related to
discontinued operations.

-- We continue the process of seeking regulatory approval for our pending
merger with Ticketmaster Entertainment, Inc. and we currently expect
that this transaction will be completed in the first quarter of 2010.
For the third quarter of 2009, we incurred $7.8 million of acquisition
transaction expenses. These costs are now required to be expensed
under new accounting rules in 2009 and therefore reduced our operating
income for the period.

Key operating metrics related to our business for the third quarter and nine months ended September 30 are outlined below:

METRICS
-------
(Unaudited; $ in millions except as noted)

Q3 Q3 9 months 9 months
Key Drivers 2009 2008 Variance 2009 2008 Variance
----------- ---- ---- -------- ---- ---- --------
Global Music
------------
Talent Costs and
Other Event
Direct
Operating
Expenses $1,459.2 $1,288.6 13.2% $2,659.3 $2,559.3 3.9%
Talent and
Other Event
Expenses as %
of Total
Revenue 82.8% 82.3% 81.5% 80.9%
Number of Live
Rights
(Concerts)
(est.) 4,750 4,790 (0.8%) 14,902 15,103 (1.3%)
Total Attendance
(est.) 19,551,000 17,471,000 11.9% 39,721,000 38,836,000 2.3%
Ancillary Revenue
per Attendee -
NA Music Amps
only* $17.58 $17.02 3.3% $17.78 $17.24 3.1%
Total Revenue
per Attendee $90.18 $89.60 0.6% $82.13 $81.47 0.8%
------ ------ ---- ------ ------ ----

Sponsorship
-----------
Number of Sponsors
(est.) - as of
September 30,
2009 793 770 3.0% 793 770 3.0%
Sponsorship Revenue
Recognized $78.5 $75.2 4.4% $144.6 $138.2 4.6%
Average Revenue
per Sponsor
(rounded,
whole $) $99,000 $98,000 1.0% $182,000 $179,000 1.7%
------- ------- ---- -------- -------- ----

* Excludes rentals

FINANCIAL HIGHLIGHTS - 3rd QUARTER
----------------------------------
(Unaudited)
-----------

Q3 2009 Q3 2008 Growth
------- ------- ------
$ in millions
Revenue
North American Music $1,036.2 $962.3 7.7%
International Music 726.9 603.1 20.5%
Ticketing 30.2 6.7 **
Other 15.0 16.4 (8.5%)
---- ---- -----
$1,808.3 $1,588.5 13.8%
======== ======== =====
Margins
Adjusted Operating -------
Income (Loss) Q3 2009 Q3 2008
------- -------
North American Music $99.4 $75.5 31.6% 9.6% 7.8%
International Music 57.6 47.2 22.0% 7.9% 7.8%
Ticketing 12.5 (5.1) ** 41.4% **
Other 5.4 2.6 **
Corporate (14.1) (10.7) (31.8%)
----- ----- ------ ---- ----
$160.8 $109.5 46.9% 8.9% 6.9%
====== ====== ===== ==== ====
Operating Income (Loss)
North American Music $71.9 $56.6 27.0% 6.9% 5.9%
International Music 50.7 38.6 31.3% 7.0% 6.4%
Ticketing 9.5 (6.5) ** 31.5% **
Other 6.4 0.4 **
Corporate (15.9) (13.6) (16.9%)
----- ----- ------ ---- ----
$122.6 $75.5 62.4% 6.8% 4.8%
------ ----- ----- ---- ----
Acquisition Transaction
Expenses:
International Music (0.7) - **
Corporate (7.1) - **
----- --- --- ---- ----
$114.8 $75.5 52.1% 6.3% 4.8%
====== ===== ===== ==== ====

** percentages not meaningful

The highlights of our financial information for the third quarter of 2009, as compared to the third quarter of 2008, are as follows:

Revenue change - Total increase of $219.8 million, primarily driven by:
-- $218.3 million - Increase in International Music due to the re-opening
of the O2 in Dublin, strong festival performance in the United Kingdom
and Belgium and strong stadium shows for our global touring artists U2
and Madonna.
-- $57.2 million - Increase in North American Music primarily due to
higher attendance at arena shows and third-party venues and the
opening of our new House of Blues clubs in Houston and Boston.
-- $24.5 million - Acquisition of De-Lux in North American Music.
-- $23.5 million - Increase in Ticketing due to increased service charge
revenue from our new ticketing platform.
-- ($16.8) million - Decrease in International Music related to the
divestiture of F&P Italia.

-- ($88.1) million - Foreign exchange movements, primarily in
International Music.

Adjusted Operating Income (Loss) change - Total increase of $51.3 million, primarily driven by:

-- $24.3 million - Increase in North American Music primarily due to
increased show results for arena tours combined with lower fixed costs
due to cost-saving initiatives.
-- $17.7 million - Increase in International Music primarily due to
strong stadium shows and festivals in the United Kingdom and Belgium
and the reopening of the O2 Dublin.
-- $17.6 million - Increase in Ticketing due to increased net revenue
from ticket service charges related to events that occurred during the
third quarter of 2009.

-- ($8.5) million - Foreign exchange movements, primarily in
International Music.

Operating Income (Loss) change - Total increase of $39.3 million, primarily driven by:

-- $51.3 million - Overall increase in adjusted operating income noted
above.
-- ($5.9) million - Higher depreciation and amortization expense due to
an increase primarily in our North American Music segment driven by
higher amortization of intangible assets associated with certain
artist rights agreements.

-- ($7.8) million - Acquisition transaction expenses in Corporate and
International Music which are now required to be expensed under new
accounting rules in 2009. These costs are primarily related to our
planned merger with Ticketmaster Entertainment, Inc.

FINANCIAL HIGHLIGHTS - NINE MONTHS ENDED SEPTEMBER 30
-----------------------------------------------------
(Unaudited)
-----------

9 months 9 months
2009 2008 Growth
---- ---- ------
$ in millions
Revenue
North American Music $2,051.8 $1,989.1 3.2%
International Music 1,210.6 1,175.0 3.0%
Ticketing 60.5 19.8 **
Other 47.7 67.0 (28.8%)
---- ---- ------
$3,370.6 $3,250.9 3.7%
======== ======== ====
Margins
-------
Adjusted Operating 9 months 9 months
Income (Loss) 2009 2008
---- ----
North American Music $101.9 $100.7 1.2% 5.0% 5.1%
International Music 85.9 69.7 23.2% 7.1% 5.9%
Ticketing 8.6 (11.1) ** 14.2% **
Other 16.5 12.5 32.0%
Corporate (35.3) (30.3) (16.5%)
----- ----- ------ ---- ----
$177.6 $141.5 25.5% 5.3% 4.4%
====== ====== ===== ==== ====
Operating Income (Loss)
North American Music $20.5 $36.9 (44.4%) 1.0% 1.9%
International Music 61.4 42.6 44.1% 5.1% 3.6%
Ticketing (1.1) (14.7) ** (1.8%) **
Other 14.6 6.3 **
Corporate (41.9) (38.1) (10.0%)
----- ----- ----- ---- ----
53.5 33.0 62.1% 1.6% 1.0%
---- ---- ----- ---- ----
Acquisition Transaction
Expenses:
International Music (0.8) - **
Corporate (25.7) - **
----- --- --- ---- ----
$27.0 $33.0 (18.2%) 0.8% 1.0%
===== ===== ====== ==== ====

** percentages not meaningful

The highlights of our financial information for the nine-month period ended September 30, 2009, as compared to the same period in 2008, are as follows:

Revenue change - Total increase of $119.7 million, primarily driven by:
-- $239.6 million - Increase in International Music driven by strong
stadium shows for global touring artists including U2 and Madonna,
improved festival performance in the United Kingdom and Belgium and
the reopening of the O2 Dublin.
-- $63.5 million - Acquisitions of De-Lux in North American Music and DF
Concerts and other smaller acquisitions in International Music.
-- $40.7 million - Increase in Ticketing due to our new ticketing
platform and ticketing-related sponsorship revenue.
-- $37.6 million - Increase in North American Music primarily due to the
opening of our new House of Blues clubs in Houston and Boston and
increased attendance and average ticket prices and/or ancillary
revenue per fan at third-party venues and arenas.
-- ($33.8) million - Decrease in International Music related to the
divestiture of F&P Italia.

-- ($223.0) million - Foreign exchange movements, primarily in
International Music.

Adjusted Operating Income (Loss) change - Total increase of $36.1 million, primarily driven by:

-- $29.0 million - Increase in International Music due to the reopening
of the O2 Dublin and improved festival performance in the United
Kingdom and Belgium.
-- $19.7 million - Improvement in Ticketing due to increased net revenue
from ticket service charges related to events that occurred during the
first nine months of 2009 along with ticketing-related sponsorships.

-- ($17.4) million - Foreign exchange movements, primarily in
International Music.

Operating Income (Loss) change - Total decrease of $6.0 million, primarily driven by:

-- $36.1 million - Overall increase in Adjusted Operating Income (Loss)
noted above.
-- ($26.5) million - Acquisition transaction expenses in Corporate and
International Music, primarily related to our planned merger with
Ticketmaster, which are now required to be expensed under new
accounting rules in 2009.

-- ($18.9) million - Higher depreciation and amortization expense
primarily due to increases in our North American Music and Ticketing
segments associated with artist rights amortization, the Boston asset
sale impairment in the first quarter and the opening of our new
venues, along with increased depreciation related to our ticketing and
website platforms.

Other Information -
-- As of September 30, 2009, our cash and cash equivalents were $258.1
million and our total long-term debt was $854.6 million, including
$150.0 million outstanding on our revolving credit facility. Free
cash as of September 30, 2009 was $9.6 million and free cash flow was
$123.2 million for the third quarter of 2009 as compared to $64.4
million for the same period in 2008.
-- For the nine months ended September 30, 2009, maintenance capital
expenditures were $13.9 million and capital expenditures for revenue
generating projects were $25.4 million, a total decline of $99.2
million compared to last year due to the 2008 development and
renovation of various venues, including the O2 Dublin, House of Blues
clubs in Houston and Boston and the AMG venue expansion in Sheffield,
along with the ticketing roll-out.

-- For the nine months ended September 30, 2009, our net cash provided by
operating activities was $58.1 million, an increase of $129.5 million
over the same period in 2008 primarily from the changes in
event-related operating accounts which are dependent on the timing,
size and number of events for upcoming periods.

About Live Nation:

Live Nation's mission is to maximize the live concert experience. Our core business is producing, marketing and selling live concerts for artists via our global concert pipe. Live Nation is the largest producer of live concerts in the world, annually producing over 22,000 concerts for 1,600 artists in 33 countries. During 2008, the company sold over 50 million concert tickets and drove over 70 million unique visitors to LiveNation.com. Live Nation is transforming the concert business by expanding its concert platform into ticketing and building the industry's first artist-to-fan vertically integrated concert platform. The company is headquartered in Los Angeles, California and is listed on the New York Stock Exchange, trading under the symbol LYV. For additional information about the company, please visit www.livenation.com/investors.

Conference Call:

The company will host a teleconference today, November 9th, 2009 at 5:30 p.m. Eastern Time, which can be accessed by dialing 888-603-6873 (U.S.) or 973-321-1019 (Int'l) and referencing passcode 33530649. To access the call via webcast, please visit the Investor Relations section of the company's website at www.livenation.com/investors. Please visit the website approximately ten minutes prior to start time to ensure a connection. Additional statistical and financial information to be provided on the call, if any, will be posted supplementally under that same link. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the Live Nation website through November 16, 2009.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
(in thousands except share and per share data)

Revenue $1,808,296 $1,588,462 $3,370,569 $3,250,886
Operating expenses:
Direct operating expenses 1,470,674 1,295,416 2,689,397 2,589,443
Selling, general and
administrative expenses 164,104 174,245 472,379 495,311
Depreciation and amortization 37,401 31,490 117,699 98,761
Gain on sale of operating
assets (2,672) (1,230) (3,658) (781)
Corporate expenses 16,190 13,062 41,284 35,177
Acquisition transaction
expenses 7,780 - 26,515 -
----- --- ------ ---
Operating income 114,819 75,479 26,953 32,975
Interest expense 17,438 17,220 50,702 51,307
Interest income (348) (2,978) (2,019) (8,406)
Equity in earnings of
nonconsolidated affiliates (499) (1,979) (1,982) (871)
Other expense (income) - net 2,206 277 2,815 (838)
----- --- ----- ----
Income (loss) from continuing
operations before income taxes 96,022 62,939 (22,563) (8,217)
Income tax expense (benefit):
Current 17,918 (32,318) 30,590 (37,870)
Deferred (1,068) 470 (2,360) 6,132
------ --- ------ -----
Income (loss) from continuing
operations 79,172 94,787 (50,793) 23,521
Income from discontinued
operations, net of tax - 47,550 - 76,456
--- ------ --- ------
Net income (loss) 79,172 142,337 (50,793) 99,977
Net income (loss) attributable
to noncontrolling interests 9,925 4,344 9,865 (123)
----- ----- ----- ----
Net income (loss) attributable
to Live Nation, Inc. $69,247 $137,993 $(60,658) $100,100
======= ======== ======== ========
Basic net income (loss) per
common share attributable to
common stockholders:
Income (loss) from continuing
operations attributable to
Live Nation, Inc. $0.82 $1.17 $(0.74) $0.31
Income from discontinued
operations attributable to
Live Nation, Inc. - 0.61 - 1.00
--- ---- --- ----
Net income (loss) attributable
to Live Nation, Inc. $0.82 $1.78 $(0.74) $1.31
===== ===== ======= =====
Diluted net income (loss) per
common share attributable to
common stockholders:
Income (loss) from continuing
operations attributable to
Live Nation, Inc $ 0.78 $1.10 $(0.74) $0.31
Income from discontinued
operations attributable to
Live Nation, Inc. - 0.56 - 1.00
--- ---- --- ----
Net income (loss) attributable
to Live Nation, Inc. $0.78 $1.66 $(0.74) $1.31
====== ===== ====== =====

Weighted average common shares
outstanding:
Basic 83,631,558 76,230,900 82,296,605 75,647,661
========== ========== ========== ==========
Diluted 92,717,666 84,513,127 82,296,605 76,230,602
========== ========== ========== ==========

CONSOLIDATED BALANCE SHEETS

September 30, December 31,
2009 2008
---- ----
(unaudited) (audited)
ASSETS (in thousands)
CURRENT ASSETS
Cash and cash equivalents $258,089 $199,660
Accounts receivable, less allowance of
$5,914 as of September 30, 2009 and
$10,376 as of December 31, 2008 324,835 217,286
Prepaid expenses 330,985 194,355
Other current assets 40,405 28,517
------ ------
Total Current Assets 954,314 639,818
PROPERTY, PLANT AND EQUIPMENT
Land, buildings and improvements 1,006,324 990,433
Furniture and other equipment 276,020 260,524
Construction in progress 27,819 41,282
------ ------
1,310,163 1,292,239
Less accumulated depreciation 457,685 404,504
------- -------
852,478 887,735
INTANGIBLE ASSETS
Intangible assets - net 488,440 514,469
Goodwill 209,098 205,296
OTHER LONG-TERM ASSETS
Notes receivable, less allowance of $556
as of September 30, 2009 and $562 as of
December 31, 2008 255 672
Investments in nonconsolidated affiliates 18,193 18,519
Other long-term assets 174,083 210,214
------- -------
Total Assets $2,696,861 $2,476,723
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $88,294 $53,563
Accrued expenses 540,617 378,992
Deferred revenue 275,535 225,664
Current portion of long-term debt 50,106 48,637
Other current liabilities 23,840 64,381
------ ------
Total Current Liabilities 978,392 771,237
Long-term debt, net of discount 804,477 775,483
Other long-term liabilities 140,219 146,360
Series A and Series B redeemable
preferred stock 40,000 40,000
Commitments and contingent liabilities
STOCKHOLDERS' EQUITY
Common stock 859 785
Additional paid-in capital 1,090,953 1,063,564
Retained deficit (434,264) (373,606)
Cost of shares held in treasury (9,514) (7,861)
Accumulated other comprehensive income
(loss) 8,634 (961)
----- -----
Total Live Nation, Inc. stockholders'
equity 656,668 681,921
Noncontrolling Interests 77,105 61,722
------ ------
Total Stockholders' Equity 733,773 743,643
------- -------
Total Liabilities and Stockholders'
Equity $2,696,861 $2,476,723
========== ==========

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Nine Months Ended
September 30,
-------------
2009 2008
---- ----
(in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(50,793) $99,977
Reconciling items:
Depreciation 76,033 57,981
Amortization of intangibles 41,666 54,572
Impairment of operational assets - 16,035
Deferred income tax expense (benefit) (2,360) 6,132
Amortization of debt issuance costs 2,763 3,106
Amortization of debt discount 6,528 5,923
Non-cash compensation expense 10,011 9,588
Gain on sale of operating assets (3,658) (167,797)
Equity in losses (earnings) of nonconsolidated
affiliates (1,982) 673
Changes in operating assets and liabilities, net of
effects of acquisitions and dispositions:
Increase in accounts receivable (108,003) (126,615)
Increase in prepaid expenses (73,228) (83,259)
Increase in other assets (22,522) (89,552)
Increase in accounts payable, accrued expenses and
other liabilities 184,611 89,288
Increase (decrease) in deferred revenue (995) 52,885
Decrease in other - net - (401)
--- ----
Net cash provided by (used in) operating
activities 58,071 (71,464)
CASH FLOWS FROM INVESTING ACTIVITIES
Collections of notes receivable 616 106
Advances to notes receivable (555) -
Distributions from nonconsolidated affiliates 2,223 4,976
Investments made in nonconsolidated affiliates (821) (255)
Purchases of property, plant and equipment (39,358) (138,550)
Proceeds from disposal of operating assets, net of
cash divested 38,516 194,286
Cash paid for acquisitions, net of cash acquired (12,538) (35,977)
Purchases of intangible assets (27,863) (18,816)
Decrease in other - net 187 308
--- ---
Net cash provided by (used in) investing
activities (39,593) 6,078
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt, net of debt issuance
costs 430,511 275,242
Payments on long-term debt (416,143) (327,614)
Contributions from noncontrolling interest partners - 8,847
Distributions to noncontrolling interest partners (816) (1,845)
Proceeds from exercise of stock options - 636
Issuance of treasury stock 1,553 -
Payments for purchases of common stock (5,803) (3,628)
------ ------
Net cash provided by (used in) financing
activities 9,302 (48,362)
Effect of exchange rate changes on cash and cash
equivalents 30,649 (19,327)
------ -------
Net increase (decrease) in cash and cash
equivalents 58,429 (133,075)
Cash and cash equivalents at beginning of period 199,660 338,991
------- -------
Cash and cash equivalents at end of period $258,089 $205,916
======== ========

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, including its prospects for delivering increased annual cash flows, reducing its long-term debt and strengthening its balance sheet; the company's anticipated achievement of its strategic objectives, including with respect to its new e-commerce ticketing site; the company's planned capital expenditures for the remainder of 2009; and the anticipated timing of the closing of the company's pending merger with Ticketmaster Entertainment, Inc. 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 the economic slowdown and operational challenges associated with selling tickets and staging events.

Live Nation refers you to the documents it files from time to time with the U.S. Securities and Exchange Commission, or SEC, specifically the section titled "Item 1A. Risk Factors" of the company's most recent Annual Report filed on Form 10-K, as amended and as updated by the company's Current Reports on Form 8-K filed with the SEC on May 28, 2009 and September 16, 2009, 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 acquisition transaction expenses, 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 net cash interest expense, less current tax expense, less maintenance capital expenditures, less distributions to noncontrolling 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 revenue, less accrued artist fees, less collections on behalf of others plus prepaids related to artist settlements and 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 venue and other revenue generating 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)
-----------------------

Loss
(gain) Deprecia-
Adjusted Non-cash on tion Acquisi-
operating compensa- sale of and tion Operating
income tion operating amortiza- transaction income
($ in millions)(loss) expense assets tion expenses (loss)

Three months ended September 30, 2009
-------------------------------------

North American
Music $99.4 $1.5 $(0.1) $26.1 $- $71.9
International
Music 57.6 0.3 (0.1) 6.7 0.7 50.0
Ticketing 12.5 0.1 - 2.9 - 9.5
Other 5.4 - (2.5) 1.5 - 6.4
Corporate (14.1) 1.6 - 0.2 7.1 (23.0)
----- --- --- --- --- -----
Total Live
Nation $160.8 $3.5 $(2.7) $37.4 $7.8 $114.8
====== ==== ===== ===== ==== ======

Three months ended September 30, 2008
-------------------------------------

North American
Music $75.5 $0.9 $(0.7) $18.7 $- $56.6
International
Music 47.2 0.3 - 8.3 - 38.6
Ticketing (5.1) 0.1 - 1.3 - (6.5)
Other 2.6 - - 2.2 - 0.4
Corporate (10.7) 2.4 (0.5) 1.0 - (13.6)
----- --- ----- --- --- -----
Total Live
Nation $109.5 $3.7 $(1.2) $31.5 $- $75.5
====== ==== ===== ===== ==== ======

Nine months ended September 30, 2009
------------------------------------

North American
Music $101.9 $3.3 $(1.0) $79.1 $- $20.5
International
Music 85.9 1.1 (0.2) 23.6 0.8 60.6
Ticketing 8.6 0.2 - 9.5 - (1.1)
Other 16.5 - (2.5) 4.4 - 14.6
Corporate (35.3) 5.5 - 1.1 25.7 (67.6)
----- --- --- --- ---- -----
Total Live
Nation $177.6 $10.1 $(3.7) $117.7 $26.5 $27.0
====== ===== ====== ====== ===== =====

Nine months ended September 30, 2008
------------------------------------
North American
Music $100.7 $4.9 $(0.8) $59.7 $- $36.9
International
Music 69.7 0.5 - 26.6 - 42.6
Ticketing (11.1) 0.3 - 3.3 - (14.7)
Other 12.5 - (0.2) 6.4 - 6.3
Corporate (30.3) 4.8 0.2 2.8 - (38.1)
----- --- --- --- --- -----
Total Live
Nation $141.5 $10.5 $(0.8) $98.8 $- $33.0
====== ===== ===== ===== === =====

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

($ in millions) Q3 2009 Q3 2008
--------------- ------- -------
Adjusted operating income $160.8 $109.5
Less: Cash interest expense - net (13.8) (10.6)
Current tax expense (17.9) (31.7)
Maintenance capital expenditures (5.3) (2.6)
Distributions to noncontrolling
interest partners (0.5) (1.4)
Distributions from (contributions to) investments
in nonconsolidated affiliates (0.1) 1.2
---- ---
Free cash flow $123.2 $64.4
-------------- ------ -----

9 months 9 months
($ in millions) 2009 2008
--------------- ---- ----
Adjusted operating income $177.6 $141.5
Less: Cash interest expense - net (39.4) (33.9)
Current tax expense (30.6) (45.3)
Maintenance capital expenditures (13.9) (21.7)
Distributions to noncontrolling
interest partners (0.8) (1.8)
Distributions from (contributions to) investments
in nonconsolidated affiliates 1.4 4.7
--- ---
Free cash flow $94.3 $43.5
-------------- ----- -----

Reconciliation of Cash and Cash Equivalents to Free Cash
--------------------------------------------------------

September 30,
($ in millions) 2009
--------------- ---------
Cash and cash equivalents $258.1
Deferred revenue - event-related $(258.2)
Accrued artist fees $(63.3)
Collections on behalf of others $(91.8)
Prepaids related to artist
settlements/events $164.8
------
Free cash $9.6
--------- ----

Photo: http://www.newscom.com/cgi-bin/prnh/20081203/LAW048LOGO-b
http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com
Source: Live Nation

CONTACT: Media, John Vlautin, johnvlautin@livenation.com, or Investors,
Linda Bandov, lindabandov@livenation.com, both of Live Nation, Inc.,
+1-310-867-7000

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

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Profile: intent