Liberty Media’s SiriusXM Q1 up 11%
Liberty Media’s revenue increased $222 million to $1,011 million in Q1. Adjusted OIBDA increased by $32 million to $294 million and operating income increased $4 million to $155 million. The increase in revenue, adjusted OIBDA and operating income was primarily due to the inclusion of a full quarter of SiriusXM’s results. SiriusXM revenue in the quarter was $998 million, up 11% from Q1 2013. The subscriber base grew to 25.8 million.
Adjusted EBITDA grew 28% to $335 million. Net income was $94 million.
“Since we last reported, Liberty Media has been busy. In April, we completed the sale of $340 million of our SiriusXM shares back to SiriusXM and also sold 90% of our stake in Barnes & Noble. Today, we announced our plan to distribute non-voting Series C shares of Liberty Media, our plan to spin-off Liberty Broadband Group into a separate publicly-traded company and our purchase of additional Charter shares, which increased our beneficial ownership to 26.4%,” said Greg Maffei, Liberty Media CEO. “We believe a separate Liberty Broadband will offer investors greater choice and transparency, and is well timed with Charter’s agreements with Comcast which will result in Charter owning or serving over eight million video customers. We anticipate completing the distribution of the Series C shares in the third quarter and the spin-off by the end of the year. Our affiliated companies posted strong results across the board: SiriusXM grew revenue 11%, Charter accelerated its growth in revenue, Adjusted EBITDA and customer units and Live Nation grew revenue and AOI across the board.”
In the call, Liberty announced a plan to distribute via dividend two shares of Series C non-voting common stock for each share of LMCA and LMCB. They also announced a plan to spin-off Liberty Broadband Group into a new publicly-traded company called Liberty Broadband.
Liberty Broadband would be comprised of, among other things, Liberty Media’s (i) interest in Charter Communications, (ii) subsidiary TruePosition, (iii) minority equity investment in Time Warner Cable and (iv) certain deferred tax and deferred revenue liabilities, as well as liabilities related to the Time Warner call option. In the spin-off, record holders of Series A, Series B and Series C common stock would receive one-fourth of a share of the corresponding series of Liberty Broadband common stock for each share of common stock held by them as of the record date for the spin-off, with cash in lieu of fractional shares. In addition, stockholders will also receive a subscription right to acquire one share of Series C Liberty Broadband common stock for every five shares of Liberty Broadband common stock they receive in the spin-off.
The subscription rights are being issued to raise capital for general corporate purposes of Liberty Broadband and will enable the holders to acquire shares of Series C Liberty Broadband common stock at a 20% discount to the 20-trading day volume weighted average trading price of the Series C Liberty Broadband common stock following the completion of the spin-off. We expect the subscription rights to become publicly traded once the exercise price has been established and the rights offering to expire forty trading days following the completion of the spin-off.
The spin-off and rights offering are intended to be tax-free to stockholders of Liberty Media and the completion of the spin-off and commencement of the rights offering will be subject to various conditions, including the receipt of an opinion of tax counsel. Subject to the satisfaction of these conditions, the completion of the spin-off and the commencement of the rights offering is expected to occur in the second half of 2014.
They also plan to purchase of 897 thousand Charter shares for $124.5 million, resulting in 26.4% beneficial ownership of Charter’s equity.
Liberty Media’s Charter communications announced agreements with Comcast, which will make Charter the second largest US cable company.
Live Nation reported solid results across all lines of business; announced Live Nation Channel on Yahoo to debut this summer
Liberty Media’s board has approved the issuance of shares of its Series C common stock to holders of its Series A and Series B common stock, to be effected by means of a dividend. Holders of Series A and Series B common stock as of 5:00 p.m. ET on July 7, 2014, the record date for the dividend, will receive on July 10, 2014 a dividend of two shares of Series C common stock for each share of Series A or Series B common stock held by them as of the record date.