Madison Square Garden Loss Widens

The marquee outside Madison Square Garden in Midtown Manhattan pays tribute to the late Muhammad Ali on June 9, 2016. ENLARGE
The marquee outside Madison Square Garden in Midtown Manhattan pays tribute to the late Muhammad Ali on June 9, 2016. Photo: Getty Images

Madison Square Garden Co. MSG -2.09 % posted a deeper loss in the latest quarter as revenue slid more than expected, hurt by weaker performance in its sports and entertainment operations.

In September, Madison Square Garden separated its media business and its sports-entertainment business. Its media business, which includes MSG regional sports-TV networks, became MSG Networks Inc. MSGN 4.25 % Meantime, its sports operations, which include the New York Knicks and Rangers, and its entertainment business, which organizes and hosts live events in venues such as Manhattan’s Radio City Music Hall and Madison Square Garden, became the reporting segments of Madison Square Garden Co.

For the June quarter, Madison Square Garden reported a loss of $ 58.4 million, or $ 2.39 a share, compared with a loss of $ 1.1 million, or 4 cents a share, a year prior. The company said it recorded $ 6.9 million in reorganization costs recorded during the period.

Revenue dropped 15% to $ 217.8 million.

Analysts polled by Thomson Reuters had forecast a loss of $ 1 a share on $ 219 million in revenue.

Revenue in its sports business, which makes up more than 60% of the top line, fell 17% mostly because of lower playoff-related revenue and event-related sales associated with other live sporting events.

“The decrease in playoff-related revenues was primarily due to the Rangers playing two home playoff games this past season,” compared with 11 in the same quarter a year ago, when they advanced to the Eastern Conference Finals, said Financial Chief Donna Coleman on a conference call after the earnings report.

Revenue in the entertainment business fell 10% from the same quarter a year before, due to lower revenue for the New York Spectacular Starring the Radio City Rockettes, and the absence of a $ 3.6 million insurance recovery recorded in the prior year quarter related to lost revenue from superstorm Sandy for the Rockettes show.

Shares fell 2.4% in afternoon trading to $ 183.70 but have risen 14% so far this year.

MSG Networks on Thursday reported better-than-expected earnings in the fiscal fourth quarter and posted a rise in the top line, helped by continued strength in affiliate and advertising revenue. Shares of that company rose 3% to $ 18.66 on Friday.

Write to Anne Steele at [email protected] US Business

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