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Latest SFX figures published as chatter about Sillerman’s buy-back continues

By | Published on Tuesday 11 August 2015


Following all the kerfuffle around Beatport royalty payments last week, its parent company SFX Entertainment put out its latest financial update for investors yesterday.

Interest in the company’s affairs has heightened, of course, because of founder Robert Sillerman’s grand plan to buy back all the shares he doesn’t currently own in the firm and take it back into private ownership.

Some odd dealings with newly sold shares on the side, coupled with the since backtracked declaration by Beatport last week that it couldn’t pay labels what they were due because of Sillerman’s ongoing buy-back plan, have led to much speculation on Wall Street and in the music industry as to how the EDM powerhouse is performing.

The latest financials don’t contain any real surprises, though. There is plenty of growth in terms of revenue, with ticket sales for the firm’s festivals bringing in the lion’s share of the $121 million made last quarter, $14.4 million being generated by the company’s online ventures, like Beatport, and the all important – for the commercial end of the live space – brand partnerships unit.

Those revenues were slightly ahead of most analyst expectations, though most Wall Street types focused instead on the overall net loss of $48 million for the quarter. Which, given SFX is still in essence a start up which is still pursuing an aggressive growth strategy, isn’t in itself much of a surprise, though adds to those concerned about the company’s cash flow and/or strategy, which means shares in the company remain very wobbly indeed, currently pegged at $2.36 per share.

Which, of course, makes Sillerman’s proposal to buy those shares back at $5.25 a piece all the more generous. Though speculation still remains that he won’t be able to secure enough financial backing to go through with that plan, either forcing new negotiations on price, or some kind of alternative strategy. The SFX chief now has until Thursday to update everyone on his progress. So, despite having a new set of numbers to crunch, investment types are really more interested in what Sillerman will say then.