Liberty Media's (FWONA) CEO Greg Maffei on Q4 2016 Results - Earnings Call Transcript

| About: Liberty Media (FWONA)

Liberty Media Corp (NASDAQ:FWONA)

Q4 2016 Results Earnings Conference Call

February 28, 2017, 11:00 AM ET


Courtnee Chun - SVP, IR

Greg Maffei - President and CEO

Mark Carleton - CFO


Vijay Jayant - Evercore ISI

Jeff Wlodarczak - Pivotal Research

Barton Crockett - FBR Capital Markets

Jason Bazinet - Citi

John Tinker - Gabelli & Company

Kannan Venkateshwar - Barclays

Tom Eagan - Telsey Advisory Group

Brandon Ross - BTIG

Matthew Harrigan - Wunderlich Securities


Ladies and gentlemen, thank you for standing by. Welcome to the Liberty Media Corporation Fourth Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded Tuesday, February 28, 2017.

I would now like to turn the call over to Courtnee Chun, Senior Vice President of Investor Relations. Please go ahead.

Courtnee Chun

Thanks, Kayla.

Before we begin we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, market potential, new service and product launches, the proposed refinancing of certain delta top co debt, the potential issuance of Formula One K shares to the Formula One team, the construction of the new ballpark for the Atlanta Braves and the associated mixed use development, and other matters that are not historical facts.

These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including without limitation the possible changes in market exceptions of new products or services, the ability of our business to attract and retain customers, competitive issues, regulatory issues and the availability of capital on terms acceptable to Liberty Media.

These forward-looking statements speak only as the date of this call. And Liberty Media expressly disclaims the obligation or undertaking to disseminate any updates or revision to any forward-looking statements contained herein to reflect any change in Liberty Media's expectations with regard thereto, or any change in events, conditions or circumstances on which any such statement is based.

On today's call we will discuss certain non-GAAP financial measures, including adjusted OIBDA. The required definitions and reconciliations schedules 1 through 3 can be found at the end of the earnings press release issued today, which is available on the website.

This call also may include certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Liberty Broadband. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These forward-looking statements speak only as of the date of this call, and Liberty Broadband expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty Broadband's expectations with regard thereto, or any change in events, conditions or circumstances on which any such statement is based.

Now I'd like to introduce Greg Maffei, Liberty's President and CEO.

Greg Maffei

Thank you, Courtnee. Good morning.

Today speaking on the call we will also have Liberty's CFO, Mark Carleton. During Q&A we will be available to answer questions that you have about Liberty Broadband as well. On January 23 we closed the Formula One acquisition. On that day Chase Carey was appointed CEO in addition to his job as Chairman. I can think of no one in the world better suited for this role.

I want to once again thank Bernie Ecclestone for his efforts in building this fantastic business. Chase has added several strong players to his team, notably Ross Brawn, Managing Director of Motorsports, whose storied success at Ferrari and Mercedes is amazing. For you Americans on the call he is the Bill Belichick of F1. And Sean Bratches, Managing Director of Commercial Operations, a fantastic leader who had a huge role in building this phenomenal success at ESPN.

We also received commitments in the last few days for the refinancing of the first lien term loan at Formula One. We took a full $3.1 billion first lien term loan, which was expected to be refinanced at a rate decrease of 50 basis points. The maturity date will be extended from July 2021 to the earlier of February 2024 or six months prior to the maturity of the second lien term loan, which is currently maturing in 2022. We also expect to use cash on the balance sheet to repay $300 million of the $1 billion second lien term loan. Together these actions and financings will result in annual savings around $36 million a year.

We expect to close in Q1, the deal as we said, and we're working with the teams to make changes to enhance the sport and potentially invest in Formula One. We know you are all excited to talk about this, but recall this deal which I said closed in January, so is not consolidated in the Q4 results which we are here to discuss. We do plan to provide the Q4 results as soon as we put them to U.S. GAAP. In the interim we will provide a qualitative discussion in the earnings release, which hopefully you have seen. We expect that we and the Formula One management team will have more to discuss in Q2. We very much look forward to the start of this great season on March 26 in Australia.

Onto the operational highlights. At SiriusXM we had another fantastic year. 2016 revenue climbed 10% to $5 billion, net income rose 46%, and adjusted EBITDA grew 13% to $1.88 billion. SiriusXM beat 2016 guidance pretty much across the board. It also generated free cash flow of $1.51 billion, up 15% as of the end of January. Liberty Media's ownership in SiriusXM stood at about 67.1%. The discount to NAV has widened, so if you like Sirius it's 15% or more off at XMA.

Live Nation recorded its sixth consecutive year of record results. Revenue was up 15%, operating income up 40% and adjusted operating income up 12% at constant currency rates as compared to 2016. The Live Nation concert attendance of 71 million was up 12%, and ticket sales were up double digits year over year through February 17 of this year.

Onto the Braves. The Minor League teams are again among the top ranked, if not the top ranked. Mark will go into more detail, but we are on time and on budget, and set for opening day on April 14. The Braves just received the certificate of occupancy for the new SunTrust Park from Cobb County, - a huge milestone.

Over at Liberty Broadband, Charter reported strong results. In 2016 pro forma customer growth, or PSUs, were up nearly 5%, revenue was up 7%, and we experienced double-digit adjusted EBITDA growth. The network passes 49.2 million homes and businesses, currently serves 26.2 million residential and SMB customers. We are on progress - progressing on track for the Time Warner/Bright House integration, confident that we will be able to achieve the milestones that were set forward in the times that were set forward. During 2016 Charter repurchased nearly $1.6 billion of its common stock.

With that, let me turn it over to Mark for more financial results.

Mark Carleton

Thank you, Greg.

Let's start with an update of the Braves and the ballpark and the mixed-use project. Very impressive that the group down there remains on time and on budget and on track for the home opener on April 14. As of the end of the year approximately $618 million had been spent on the new ballpark, of which $373 million was provided by Cobb County and some of that, their related entities, and $245 million in debt had been borrowed by the Braves.

At that same date we spent approximately $309 million on the mixed-use development, of which $46 million was provided by our joint venture partners. The remaining $256 million was provided by the Braves, of which $188 million was contributed in equity and around $68 million in debt. That project is going very, very well. At year end the Liberty SiriusXM group had attributed cash and liquid investments of $73 million. That excludes the SiriusXM's actual cash on hand.

The value of the SiriusXM stock we held at that time as of 2/27 was worth $16.4 billion and has around $250 million in debt against these holdings. The Braves Group had attributed cash and liquid investments of $107 million. The Formula One Group had attributed cash and liquid investments of $168 million.

Formula One Group holds public market securities with a market value of around $2.7 billion as of the end of on February with $2.3 billion of attributed debt. Now, we are referring to this entity as the Formula One Group, but bear in mind we did not close until January so there is no actual financial results in our December 31 2016 financial statements relative to Formula One.

At year end the Liberty SiriusXM Group had attributed principal amount of debt of $6.2 billion which includes $5.9 billion of debt at Sirius. The Braves Group had an attributed principal amount of debt of $338 million. The Formula One Group had attributed principal amount of debt of $1.6 billion.

In the fourth quarter the Formula One tracking stock incurred about $15 million in SG&A expense, which includes stock-based comp but excludes amounts allocated to Liberty SiriusXM and to the Braves tracking stock. For the quarter about $13 million of SG&A including stock comp was allocated to Liberty SiriusXM and about $2 million allocated over to the Braves Group.

And with that, we will go back over to Greg.

Greg Maffei

Thanks Mark. To the listening audience, we appreciate your continued interest in Liberty Media. We look forward to seeing you at the many upcoming conferences. With that, operator, I'd like to open it up for questions.

Question-and-Answer Session


[Operator Instructions] Your first question comes from the line of Vijay Jayant with Evercore ISI.

Vijay Jayant

Thanks Greg. A couple questions. I know you don't want to talk too much about F1 until we have the results. Just more on the qualitative side, do you guys feel that the agreements you have with the teams is equitable? Some teams take a lot of money and some don't, like some of the other leagues that benefit from success of the broader league in general.

Is there a chance that we could have a change in the contractual arrangements under the new leadership? Then just following up on that, obviously it seemed that F1 under Bernie was pretty much a one-man show. Now it's becoming a more professional, that may not be the right word, more corporate-wise, more talent added. How do you see margins tracking relative to the monetization opportunity?

Greg Maffei

Thanks, Vijay. First on the teams, as you rightly noted until 2020 we're under a Concorde agreement which sets the terms of the payments to the teams. We are hoping that with some inducements, including the stock we're offering, with some incentives around trying to create a more balanced and fair and more competitive race environment that we may see changes, but there are no guarantees of that certainly before 2020.

Understandably teams that are being paid particularly well today will be reluctant to give those payments up. But I think all parties understand the need for a competitive race environment, and like the NFL, any given Sunday to see an opportunity to have teams come from behind and win, not have the usual players, not in anybody's interest to have a noncompetitive, non-interesting non-exciting sporting event. We will update you on progress of that as we move forward.

On the margin side, I think everything that we thought about this business and the opportunity as we did our due diligence and the time we spent prior to purchasing Formula One has only been confirmed. There is an enormous opportunity in areas like sponsorship. There is enormous - in the short-term. There are longer-term opportunities around digital, including gamification, including virtual reality. There are opportunities in broadcasting. There are opportunities probably to create more segment around events, as I started with, but also more revenue opportunities around those events as we build to the weekend.

Some of those will take time. I think in the short term we are unlikely to see margin expansion, because even though there are some near-term wins around things like advertising, over the longer term I think there are - and there's going to be expense to achieve that.

Over the longer term I definitely think there's opportunities, and we will pay for that in part through things like smart financial actions like we mentioned on the savings on the refinancing. That's obviously a savings below the line on EBITDA, but those are all important for paying for what were going to do. Over the long term I think everything we thought, as I said, challenges of probably as big or bigger, but the opportunities is big or bigger than we originally thought.

Vijay Jayant

Great. Thanks so much.


Your next question comes from the line Jeff Wlodarczak with Pivotal Research.

Jeff Wlodarczak

Good morning. Quick follow-up on F1. Greg, I wanted to get your thoughts on the idea of instituting team spending caps which seems, at least to me, like an obvious way to improve the profitability of the teams and maybe encourage other teams to join the series. And then I had have a quick one on Charter.

Greg Maffei

I think it goes part and parcel with the comments I was making to Vijay about creating a more competitive race environment and creating more excitement and creating a more stable opportunity. I think Chase has said rightly, we want the lesser ranked teams, the less successful teams, to be able to be profitable and the highly successful teams to be very profitable.

But some of that is stacked today. Could you create more fairness with a race cap? Certainly something others have talked about. It will be in the execution in that and how to really make it fair, how to make it accountable. People like Ross Brawn are far more articulate on the topic, can be far more effective, I think, than many of the prior attempts. We will see how it goes.

Jeff Wlodarczak

Thanks. Then on Charter it sounds like the head of the SEC is circulating an order to eliminate Charter's Time Warner cable overbuild requirement concession. Do you think there's opportunities for Charter to re-review some of the other deal concessions that appear to be at odds with the new FCC's thinking, like usage-based pricing?

Greg Maffei

Thanks, Jeff. Just on that point, it's a fairly nuanced change, as I know you know, but for the full listening audience the change is really the requirement on where the build-out occurs and the lack of requirement that it be, as you rightly said, an overbuild, more opportunity Greenfield, more opportunity to people aren't necessarily cable players.

And that is the nature of the change. It's clear that this FCC is evolving. It's clear that there are changes in how many of the doctrines that were adopted under the Wheeler of FCC will be modified. I think all bets are open to being reset in terms of things like usage-based pricing. Obviously some of the definitions of net neutrality have already been moved, and we will see further ones I suspect.

Jeff Wlodarczak

Thanks, Greg.


Your next question comes from the line of Barton Crockett with FBR Capital Markets.

Barton Crockett

Okay, great. Thanks for taking the question. Stepping back a little bit on F1, there was a Journal story that I thought was interesting about this broad sport talking about the pressures of NASCAR. They've had steep declines in ticket sales and viewership up on TV.

Does that kind of pressure at NASCAR create an opportunity potentially to over time try and move more F1 into the U.S., or does that kind of argue maybe it's not a very hospitable environment and maybe a warning signal in your opinion?

Greg Maffei

Thank you, Barton. A couple things there. I think that article rightly pointed out some of the challenges that all sports want to make sure they are fresh, make sure they are differentiated, make sure they are unique product, make sure they are events, but it also suggested there are substantive and substantial differences from what we have at Formula One from NASCAR. The nature of our 21 events in 21 countries suggests far less opportunity for fatigue and overwhelming viewers and overwhelming ticket buyers in any one region because it's not available on that kind of frequency.

Our positioning in the marketplace is probably less to the middle income buyer but more to the high income. We do want to broaden that but we sit up at the top of the pyramid with very - a fluent customer base, opportunities to expand that but our reach doesn't need to be nearly as deep into the customer buying public as a sport that is as broad in the United States as NASCAR. I think there are careful lessons to be learned in there, but also points out opportunities in differentiation that we at Formula One have.

Barton Crockett

Okay. Then on the same tracking business, with Live Nation now basically part of a racing tracking stock, is that the right place for that to sit or do you think over time there might a more appropriate place for the Live Nation stake to sit?

Greg Maffei

Barton, that's a great leading question. A couple of thoughts on that. First, Live Nation is an amazingly differentiated Company as well. It is both a music company, which has obviously through its management company, enormous relations particularly with artists, music artists. But it really, if you think about it another way, it is a producer of live events. It has had massive success of promoting those events. It actually has already been involved in certain races like in Singapore with helping promote Formula One.

There are synergies and potentials you can imagine around what Live Nation can do and what Formula One can do. The Singapore race is considered by many to be one of our couple of three best races in terms of excitement and in terms of the full power of the event in leveraging the full audience potential.

So I think there's a lot of synergies that are there that arguably are interesting around the Formula One and Live Nation space as a promoter, and also remember Live Nation is first and foremost the largest ticketing company in the world.

We ticket an awful lot of events that are beyond music, NFL, many NBA, many sporting events, many other events which are non-music. Live Nation is an interesting Company. It's differentiated, it's neither a pure music fish nor a live event only fowl, nor - it's a lot of things that are very powerful.

Barton Crockett

Okay, great. Thank you.


Your next question comes from the line of Jason Bazinet with Citi.

Jason Bazinet

Just a question for Mr. Maffei. I think at your Analyst Day in early November you lamented that LSXMA was trading at a discount to Sirius. You said you were very focused on that. You were focused taking steps to close that gap. I was just wondering if you could elaborate a bit on what the impediments have been that have prevented you from closing that gap now that four months or so has elapsed?

Greg Maffei

Jason, thank you for the question. I think we have talked in the past about when is the right time to do that. We have a case, as I've mentioned in the past, where Sirius is reducing the supply of stock at a faster rate than we are reducing LSXMA because frankly we're not reducing any of LSXMA during the past quarter. They have cash flows, $1.51 billion for the year of free cash flow at SXM to go and attack about $7 billion, or now I guess about $8 billion of market cap.

We have very limited cash flows at LSXMA. We have quite a lot of balance sheet capacity, but we have a $14 billion or $15 billion underlying value there in stock. So we're attacking with less cash flow a larger problem. The market continues to think we're going to do something to use the LSXMA stock to take in SXM. That's the market's prerogative to think.

I think the odds we do that in some way which is highly dilutive are virtually zero. So think away, but it ain't going to happen. You want to bet against us on that, you're welcome to. That's the market's prerogative, but I wouldn't hold my breath unless you've got a hell of a lot of lung capacity.

I've talked about the ways we might do that and I've also talked about the impediments to doing that, and then I've talked about when it would make the most sense. While that's all happening, SXM is continuing to increase our ownership in SXM because we are not sellers, we are believers in the business. It's nice to see the endorsement of holders like Berkshire Hathaway buying both LSXMA stock and SXM stock. It's an opportunity for us. It's one we'll take advantage of in the time and place of our choosing

Jason Bazinet

Can I ask one follow-up? Are there any sort of complexities that arise once your ownership in Sirius gets to 80%? Can you remind us of those, if there are any complexities?

Greg Maffei

I think the largest complexity, which is not overwhelming, is we need to have some sort of tax-sharing agreement which is fair to the minority holders. That's not an unusual situation. It's one that can be worked out relatively easily. I don't think it's one that will take an enormous amount of debate or contention if we get to that point.

Jason Bazinet

Okay. Thank you.


Your next question comes from the line of John Tinker with Gabelli & Company.

John Tinker

Hi, thank you. Couple of quick questions on the Braves. Could you talk a little more about the timing of the opening of the mixed-use development, some of the real estate, the residential, the commercial? And when you will actually see cash flows from them coming through? Secondly, there was some speculation recently on the Miami Marlins. Could you give us your view as to what valuation of baseball teams is at the moment? Thanks.

Greg Maffei

I'll comment first a little bit on the Battery and I will let Mark add to that. Then I will comment on the Marlins as well. As I think we said, San Diego Padres on April 14 opening home day, opening day for the new stadium.

I expect Battery will be operating in part. Not every retail site will be completely leased, but several and many will, and many of the other parts of the venue, commercial real estate are well underway and leased, I think.

The expectation is Comcast I think will take occupancy in November, but Mark Carleton can correct me, or somebody else. While the Battery will be partially open as a retail site there are continuing efforts to expand that, that will be beyond the April 14 opening day for the stadium.

On the Marlins valuation, the $1.6 billion, there are scuttlebutt that may be an inflated number, that maybe a nameplate number that doesn't reflect real economic - excuse me, represent real economic value. We will see. Obviously no deal has been announced. It was only rumored, and now there are rumors that it's not happening to that group at that price, so who knows.

I would posit to the proud order that the Atlanta Braves, one of the most storied and longest franchises in baseball, frankly in professional sports in the U.S., would be far more valuable than the Marlins given our fan base, given our opportunity, given the new stadium, given the potential TV revenue ahead, given the breadth of the radio coverage, many, many factors, that we would be more valuable than the Marlins whatever price is eventually printed, if it is.

Mark Carleton

Certainly, Greg, that it is our belief in terms of where our team is right now in terms of payroll, where our prospects are and our minor league system is, the number of pitchers that we have in that system. But those numbers are not surprising to us. The business of baseball is very, very good and there's a lot of value in those teams. We will see where the Marlins end up, but we were not surprised at some of the numbers that were being thrown around.

In terms of the Battery, we will have a number of the food and beverage and retail stores open at the end of the month, or at the end of March coming in - and in April. We have intentionally held back some of that space, and not on purpose leased everything out to have some spot market opportunities for what we think is a good growth market.

All of this is phased, the residential is in a different phase, some of the other phases of retail and buildings are all in the plans. This will be an ongoing three- to five-year kind of an organization to build it out. The Live Nation music venue will be open. We will have ample food and beverage and retail that will be open. I think they have managed the capacity and the leasing and the contracting quite thoughtfully.

John Tinker


Greg Maffei

Thank you John, thank you Mark. Next question please.


Your next question comes from the line of Kannan Venkateshwar with Barclays.

Kannan Venkateshwar

Thank you. Greg, on Charter essentially there was a speculations around Verizon and Charter sometime back, and obviously reacted to that. How do you think about wireless from your perspective, given the currency that you have in Charter at these levels as well as the scarcity of assets on the wireless side, especially for the incentive auction expectations? If you could walk us through your thoughts on wireless, that would be good.

Greg Maffei

I think it's a great question. It's an evolving one. First and foremost our belief is that the broadband market and position that cable has in video in broadband is probably fundamentally more attractive than the wireless business where the competition around price, around effectively things like data caps which are just a form of price are all much more vociferous than the competition currently we're expressing in the broadband market.

In addition, Charter sees enormous opportunity in just executing on its plan. The plan around Time Warner integration, Bright House integration full digital video, simplified packaging, simplified pricing, upgrades and speeds at broadband, all those we think are a great plan. So when you talk about the currency of Charter, I think one of the things that the shareholders, major shareholders like Bright House and ourself, and I suspect Tom is a major shareholder personally.

I think is our currency is going to get more valuable over time, not less, as we execute on that plan. Fundamentally we are in a very good business. Longer term, is it fairly clear there is a consolidation in wireless and wireline and those merge? Yes. The time frames are less than clear, the opportunities continue to open up in new ways. There are other players out there with spectrum, there are other players are rumored into the market all the time, like Google.

I think Tom and team are testing our entry into wireless through things like our MBNO and wi-fi first products. Whether ultimately we find the opportunity to do something around a more complete wireless play, we will see. I think that doesn't need to be decided today. I think whatever happens we will be in a stronger position six months, nine months, two years from now than we are now in terms of having a currency that is able to execute on a acquisition with stock, if that's what's necessary.

Kannan Venkateshwar

All right. Thank you.


Your next question is from the line Tom Eagan with Telsey Advisory Group.

Tom Eagan

Great, thank you. A follow-up on the FCC question. The current FCC is certainly looking to lighten the load for cable, but the FCC hasn't signaled any interest in getting involved in either retransmission fee hikes or still allowing the programmers to block the broadband access to their sites. Any thoughts on relief on these two issues? Thanks.

Greg Maffei

Let me just first Tom, if I might, if I can take the liberty of rephrasing your description.

Tom Eagan


Greg Maffei

I would not - lighten the load, I would say it's leveling the playing field. Things like the work on privacy where the requirements for what the players, Silicon Valley players, Google, Facebook, et cetera, what their privacy requirements were, were considerably less than was being asked of companies like Charter. And the FCC has done things to level that playing field, rather than - it may have the impact of lightening the load, but I think it's a question of basic fairness on how players are treated.

As far as things like re-trans, I believe that Commissioner Pai and his brethren are likely to think about free market solutions rather than trying to use their regulatory hammer as much as possible to solve those problems. I wouldn't imagine that re-trans is top order in terms of using - them coming in and using a heavy hand in fixing that. But we will see.

Tom Eagan

Is it your understanding that programmers could still - they can still block broadband subscribers access to their sites, right?

Greg Maffei

The latter point I think is a very fair one. The larger re-trans question I think is a thorny one. I think the latter point is - you're excellently very fair. When take programmer X says that a broadband subscriber from a cable company with whom they don't have a video relationship can't visit the online site. I would think that most people, most Americans including our FCC Commissioners would find that pretty offensive.

Tom Eagan

Right. Okay. Thank you.

Greg Maffei

That's a fairly narrow case. That was my point.


Your next question comes from the line of Brandon Ross with BTIG.

Brandon Ross

Hi. Thanks for taking the question. Greg, on the Sirius call we asked Jim Meyer about the public difference in attitude on a potential Pandora acquisition between yourself and Sirius management, and he responded that there is no disagreement between Liberty and Sirius on that asset. Does that mean that you both want to buy Pandora? I assume you would never buy P at the Liberty level?

Greg Maffei

I will take the first part - I will take the second part first, rather. I would think there's virtually zero chance that we would do anything at the Liberty level that does not involve Sirius. We work in conjunction with Sirius. I think Jim's comments are right on. Jim and I are - you couldn't put the thinnest wedge between Jim and I on our belief in Pandora.

Interesting asset that has not clear that the valuation makes sense, full stop. I think we have been consistent in that. At the right price, interesting. Not clear this is the right price. Frankly I think that whether it's Pandora holders or whomever have hyped that we're going to be there to bid. I wouldn't hold my breath at these levels.

Again, my comments are, you can hope all you want. Whether there is a price that meets expectations and whether we're going to execute on it, that's another matter.

Brandon Ross

Great. Thank you.


Your last question comes from the line of Matthew Harrigan with Wunderlich Securities.

Matthew Harrigan

Thank you. Riding on the drafting on Vijay's questions to an extent. There's some talk in the European business press about the F1 strategy group having a lot of meetings and being pretty re-energized. I guess there's a little hype down before on some the perspective engineering changes. So without tossing out a lot of acronyms, you see a lot of activity there that could be energizing in the short term. Then there's specific situations on the British Grand Prix at Silverstone, and then obviously [indiscernible] in terms of retaining and getting back those races in that latter German track, I guess, is particularly iconic for the sport. Thank you.

Greg Maffei

I think first there are many players in this, which makes it complicated from the FIA to the teams to the many - you mentioned the F1 strategy group to - there are a lot of players. I think fundamentally Chase and Ross Brawn are at the center of trying to make these races more interesting, more competitive, more exciting.

I think there is uniformity about many of the actions that it will take to do that. Whether we can execute on those, how long it will take, that it's still open. But I think there is a lot of consensus around ideas that could make this sport more compelling to the benefit of all players, teams, fans, regulators and the F1 commercial entity.

So a lot of alignment on those, execution is not as easy. As we said, or as I said, there are many players in here. But getting agreement, getting consensus on actual action items is not always as easy, but I'm optimistic.

On the teams - or rather on the tracks you mentioned like Silverstone and like the German track, one of the things we need to do is make, as I said, the races more compelling and exciting, and more beneficial to promoters. Take best practices, what worked in exciting races like Mexico City, like Singapore, like Abu Dhabi, bring those best practices across the globe to traditional tracks, which may not have had either as much financing capability, but also just don't have as exciting a product at the moment.

There are always tracks that go in and out. It is most negative when you have some of our traditional Western European tracks, which are at the heart of the fan base like in Germany, go out. But there is already progress to bring them back, and as you may recall, we added the Ricard track in France, another place where we have been gone for several years, which is the origin of Formula Un is in France and in England. We are big believers in making sure places like Silverstone and the French track and the German track are on the race calendar and are exciting events which are beneficial to all the players.

Matthew Harrigan

Thanks Greg.

Greg Maffei

So with that, operator, I think we are good for the morning. Thank you all for your interest in Liberty Media. As I said, we hope to see you over the coming months at the many events that we are speaking at and on the next earnings call a quarter away. Thank you.


Thank you, ladies and gentlemen. That does conclude today's conference call. We thank you for your participation, and ask that you please disconnect your lines.

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