Live music conglom Live Nation yesterday reported that it made losses of $45.6 million in the first quarter of its current financial year, up on both the previous quarter and the same period last year - in fact in the same quarter last year the company returned a profit of $5.3 million. The loss this year was despite a year on year rise in revenues, from $516.6 million to $884.2 million, a sign that the conglom's operating costs have increased in the past twelve months, mainly due to its previously reported acquisitions of the House Of Blues empire and merchandise firm Trunk Ltd.
That fact was cited by the company as one of the reasons for the overall loss - ie that the increased operational costs have impacted on the bottom line in what is always a quiet quarter for the conglom's core touring business. However, that doesn't necessarily mean a dramatic turnaround will be seen in the second busier quarter because Live Nation bosses admit they have two cycles in play - an annual seasonal cycle, but also a 2-3 year cycle which often sees the highest earning bands all touring at the same time. The first quarter last year benefited from concurrent tours from big hitters like U2, Coldplay, Billy Joel, Aerosmith, Toby Keith, Rascall Flatts and Depeche Mode - a similar collection of big hitters is not expected this year.
Live Nation chief Michael Rapino admitted that cycle, but was optimistic nevertheless. He told reporters this week: "The concert business is a seasonal and cyclical business with a cycle of generally one to three years. If a major artist tours in one year, it is typically unlikely for that artist to tour for the next year or two". But Rapino says the "three year window" is an opportunity for business change within the conglom, which is expected to include a more aggressive move into the merchandising and ticketing markets.