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The Madison Square Garden Co (MSG) Q2 2019 Earnings Conference Call Transcript

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The Madison Square Garden Co  (NYSE: MSG)
Q2 2019 Earnings Conference Call
Feb. 01, 2019, 10:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good morning. My name is Christie, and I'll be your conference operator today. At this time, I would like to welcome everyone to The Madison Square Garden Company Fiscal 2019 Second Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions) Thank you.

I would now like to turn the call over to Ari Danes, Senior Vice President of Investor Relations and Treasury for The Madison Square Garden Company. Please go ahead, sir.

Ari Danes -- Senior Vice President, Investor Relations and Treasury

Thanks, Christie. Good morning, and welcome to The Madison Square Garden Company's fiscal 2019 second quarter earnings conference call. Our President, Andy Lustgarten, will begin this morning's call with an update on the proposed spin-off transaction and the company's operations. This will be followed by a review of our financial results with Victoria Mink, our EVP and Chief Financial Officer. After our prepared remarks, we will open up the call for questions. If you do not have a copy of today's earnings release, it is available on the Investors section of our corporate website.

Please take note of the following. Today's discussion may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties. And that actual results, developments and events may differ materially from those in the forward-looking statements as a result of various factors.

These include financial community perceptions of the company and its business, operations, financial condition and the industry in which it operates, as well as the factors described in the company's filings with the Securities and Exchange Commission, including the sections entitled Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operations contained therein. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call.

On pages four and five of today's earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating income, a non-GAAP financial measure. Lastly, on pages seven and eight of the release, we present a reconciliation of adjusted operating income to adjusted operating income, excluding the impact of the adoption of ASC Topic 606, the new accounting standard for revenue recognition.

And with that, I'll now turn the call over to Andrew.

Andrew Lustgarten -- President

Thanks, Ari, and good morning, everyone. We are pleased with our financial performance for the second quarter. The Radio City Christmas Spectacular had a terrific holiday season. Our concert bookings continue to thrive, and we are benefiting from steady ongoing growth in our sponsorship business.

At the same time, we are making important progress on two key company initiatives, our MSG Sphere venues and the proposed spin-off of our sport business from our entertainment business. With respect to the spin-off, this is a significant transaction and we are working diligently, and continue to make headway on a number of work streams related to the project.

These include progress toward a long-term venue license agreement between the Garden and the Knicks and Rangers, determining the appropriate management teams and organizational structures, and assessing the optimal capital structure and capital allocation policies for each company.

Given the timing of when we now expect to satisfy all required conditions including League, IRS, SEC and final Board approval, we are now working to complete the transaction during the second half of the calendar year. We remain confident that the proposed spin-off would provide two companies with enhanced strategic flexibility and define business focus, positioning both for the long-term success.

Turning to our entertainment segment. Our booking business delivered another quarter of astounding results. This includes double-digit revenue growth, along with year-over-year increases at nearly all of our venues, most notably The Garden, as well as The Chicago Theatre, Beacon Theatre and Radio City Music Hall.

These results reflect impressive year-over-year increases in both multi-night and multi-marketing engagements, which helped drive a double-digit percentage increase in total events. This led to our venues, again, being ranked among the world's top grossing venues for 2018.

Billboard named Madison Square Garden Arena the highest-grossing venue of its size in the world for a second year in a row, while Radio City Music Hall was ranked the highest-grossing venue in the world in its category. In addition, the Forum, Beacon Theatre, Hulu Theater and The Chicago Theatre, all ranked in the top 10 of their respective classes for 2018.

We expect our bookings success will only be amplified once we open our MSG Sphere venues in Las Vegas and London. We continue to make important progress in both markets. In Las Vegas, we are in the final stages of site prep and have received all our permits for the start of construction. We have selected the general contractor and are finalizing that agreement and we'll have more to announce soon.

We also expect to begin foundation work later this month, and are now pushing toward the goal of opening the venue during calendar 2021. And in London, we are completing our planning application, which we expect to submit in the coming weeks. We will continue to update you as we move forward at both venues.

Turning to the TAO Group. As we touched on last quarter, while recent results have not met our financial expectations, we feel good about TAO Group's strategic direction and the benefits they bring to MSG. And we are actively working with TAO management on ways to reaccelerate their growth.

After a strong opening for TAO Chicago this past September, anticipating opening this year includes Moxy Chelsea next month followed by three new venues in Singapore at the Marina Bay Sands, including Marquee, which is set to open in the spring.

Regarding our production business, the Christmas Spectacular Starting the Radio City Rockettes in its 86th season had another record-setting year, a reflection of enduring popularity of this beloved show. Over one million tickets were sold for the quarter and due to these high demands, we made the decision to extend the number of shows through early January.

These strong ticket sales, coupled with increases in average ticket prices, drove another year of record revenue and profitability for the Christmas Spectacular. For this year's production, we also continue to build on enhancements we made last season, with new digital projections from Obscura and the groundbreaking new finale. These technological enhancements were among the show's most popular elements according to customer feedback and showcased the integration of new innovative audience experiences.

Turning to our sports segment. The Knicks and Rangers 2018-19 seasons are in full swing, as both teams continue to execute on their plans to build championship caliber franchises. We also completed the sale of the Liberty last month. As the proud owner of the Liberty for the past 22 years, we are pleased with the new owner who will now guide the franchise with a commitment to serving its loyal and passionate fans here in New York.

For the second quarter, we again delivered solid underlying revenue growth in sponsorship and signage across our company. During the quarter, we entered into a new marketing partnership with Verizon, making Verizon the exclusive wireless partner of the concert series at Madison Square Garden, the Forum and the Christmas Spectacular. This multi-year deal serves as yet another example of our continued ability to utilize our premium assets and brands to drive value for our partners.

In summary, we are pleased with our results for the second quarter, in particular, the strength of our co-operations, highlighted by our success in driving an increased number of events or venues, record revenues for the Christmas Spectacular and robust sponsorship results.

Before turning the call over to Victoria Mink, who we recently named the company's CFO, I would like to take a moment to personally welcome her to MSG. Victoria joined the company in October as Executive Vice President of Finance, working closely with Donna Coleman.

She previously served as Senior Vice President and Chief Accounting Officer at Cablevision and subsequently Altice. During those seven years, Victoria managed all accounting and reporting activities for a significant period of change, and was actively involved in multiple acquisition and sales transactions, as well as in initial public offering and the spin-off.

She is ideally suited to help us, as we move forward with our growth plans and I am confident that her leadership will help to ensure the company's success. On behalf of the entire company, I also want to thank Donna who played an invaluable role in helping us shape a new vision for our future. She helped lead our spin-off from MSG Networks, as well as the start of our venue expansion plans and the proposed spin-off of our sports business. We thank her for her many contributions and wish her a wonderful retirement.

With that, I will now turn the call over to Victoria, who will take you through our financial results.

Victoria Mink -- Executive Vice President and Chief Financial Officer

Thank you, Andy, and good morning, everyone. I'd like to start by saying that this is an exciting time for the company, and I am privileged to be a part of MSG as it embarks on its next chapter.

Now, turning to our financial results. As we noted last quarter, this fiscal year, we adopted the new accounting standard for revenue recognition. The most significant impact in fiscal 2019 from the new standard is a change in the timing of when we recognize several of our revenue streams, as well as certain team-related fulfillment expenses during the year, which impacts the quarterly year-over-year comparability of our results.

On a reported basis for the fiscal 2019 second quarter, MSG generated total revenues of $632.2 million and adjusted operating income of $130.4 million. Excluding the impact of the new revenue recognition standard, fiscal 2019 second quarter revenue would have been $593.6 million, an increase of 11%, and AOI would have been $98.9 million, a decrease of 17%, both as compared to the prior year quarter. Please note that these results include the impact of a significant player waiver during the quarter, without which AOI would have increased on a year-over-year basis.

Turning to reported segment results for the quarter. At MSG Entertainment, revenues of $316.5 million increased 17%. This was primarily due to higher-event related revenues at our venues, increased revenue for the Christmas Spectacular, as well as growth in sponsorship, signage and suite license fee revenue. As Andy discussed, the increases in event-related revenues reflects strong results across our venues, driven primarily by an increase in events held.

With respect to Christmas Spectacular results, for the second quarter, revenues grew by high single-digit percentage on a year-over-year basis, driven by increases in both tickets sold and average ticket prices. Second quarter entertainment AOI of $101 million increased 23% as compared with the prior year period. This was primarily due to higher event-related contribution, as well as growth in the Christmas Spectacular production and sponsorship, signage and suites.

This was partially offset by lower results at TAO Group and other net decreases. Excluding the impact of the new revenue recognition standard, entertainment revenues for the second quarter would have been $325 million, and AOI would have been $98.5 million, both an increase of 20% as compared to the prior year quarter.

At MSG Sports, revenues of $315.8 million increased 19% year-over-year, primarily due to the impact of the new revenue recognition standard. The overall increase in revenues reflected higher local media rights fees from MSG Networks, as well as increased league distributions, event-related revenues from other live sporting events, suite license fee revenue, season ticket-related revenue and sponsorship and signage revenues. This was partially offset by lower food, beverage and merchandise sales, due to fewer home games in the quarter.

MSG Sports AOI decreased 13% to $48.6 million. This was primarily due to higher direct operating expenses and to a lesser extent, higher SG&A expenses, more than offsetting the increase in revenues. The increase in direct operating expenses primarily reflected a $38 million increase in net provisions for certain team personnel transactions, which included a significant player waiver. The increase also includes the impact of a change in the timing of recognition of team personnel compensation costs as a result of the new revenue recognition standard.

Excluding the impact of the new standard, MSG Sports revenues for the second quarter would have been $268.7 million, an increase of $3.6 million. And MSG Sports AOI would have been $19.7 million, a decrease of $36 million, which primarily reflects the impact of the significant player waiver I mentioned earlier.

Corporate and other adjusted operating loss of $19.2 million increased modestly year-over-year, primarily due to costs associated with the proposed spin-off transaction and other net increases, mostly offset by lower business development related expenses.

Now turning to our balance sheet. As of December 31st, total unrestricted cash and cash equivalents was approximately $1.2 billion. This includes $125 million in proceeds received from The Azoff Company completing its acquisition of MSG's 50% interest in Azof MSG Entertainment.

As part of the sale, The Azof Company's $63.5 million revolver for which MSG is the lender, was converted into a term loan and remains outstanding. In addition, there have been no borrowings made under either our $115 million New York Rangers revolving credit facility or our $215 million New York Knicks credit facility. Lastly, as of December 31st, TAO Group's term loan balance was approximately $105 million.

With that, I will now turn the call back over to Ari.

Ari Danes -- Senior Vice President, Investor Relations and Treasury

Thank you, Victoria. Christie, can we open up the call for questions?

Questions and Answers:

Operator

Sure. (Operator instructions) And your first question is from Brandon Ross of BTIG .

Brandon Ross -- BTIG -- Analyst

Good morning. Thanks for taking the question. It sounds like you're making progress on the Spheres but the opening has been pushed now, I think to calendar '21. I assume that's because of the design changes you're making. Can you just kind of take us through the evolution of the project and maybe what changes you are making and why you are making them? And then maybe when investors might be able to see a budget?

Andrew Lustgarten -- President

Hey, Brandon. How are you doing? So let's take a step back. So, what we are trying to design here is we are trying to revolutionize the industry and we are trying to change what a venue and live experience is. And we are focused on the artist experience and the customer experience.

Those two things will drive the business. So, as we started trying to think about this business and design toward how we could disrupt the industry, we have to make sure we get it right. So, I want to take a step back and give you a little insight into the history of how we got here.

So, we've always been working with one design firm. And we started with one design group within that firm on Las Vegas. Started moving forward with that team in Las Vegas, and then we have a second team working on London. London started behind Vegas, and benefited from what we were doing in Vegas. But the London site is much more complex and a much smaller footprint.

And so as the London team continued to design that on that tighter footprint, we realized we actually started creating a better product, a better bowl that had better experience, better immersive experience, better use of technology. And we said, well, let's go and make that change back to Las Vegas. So, we've realigned Las Vegas and London almost identical interior bowl. There will be certain market differences on how we view interior design, but the bowl will be essentially the same bowl in the two markets.

No change to the outside in Las Vegas, which is very important because it didn't affect any of our permitting process. And so that's why we're moving forward and we're able to be where we are in terms of pre-construction and where we're going to be very shortly. And the most important part, why it's very important to have the same interior bowl, besides having the best customer experience is that we think this was a better immersive experience.

We're able to, which is very important, bring content across both of the Spheres without any -- without having to modify it. It also allowed us to pick the technology and make sure it's repeatable for these Spheres or any other Spheres in the future. Very focused on building components, constructing, not building, so that we can be moved faster and be more thoughtful in the future and for these two Spheres. And it also benefited by allowing us to realize certain economies of scale in purchasing across both venues.

And so we thought it was -- it made a lot of sense, and I expect we're going to continue to make enhancements as we move through this development process. But we are very confident about what we're going to do to the live experience and how we are going to change the industry.

Brandon Ross -- BTIG -- Analyst

And what about the budget?

Andrew Lustgarten -- President

Budget, well, as we are still designing and making modifications, it's just premature. As changes occur, we have to keep on being focused on what we're doing. We've made a lot of progress. Right? We started site prep. We plan to start foundation work soon. We selected a general contractor. We're still finalizing that agreement. So, there's a lot of moving pieces. So around the timetable and we will be back.

Brandon Ross -- BTIG -- Analyst

Thanks.

Operator

Thank you. Next question is from Bryan Goldberg of Bank of America.

Bryan Goldberg -- Bank of America Merrill Lynch -- Analyst

Thanks. I've got two quick questions. First, I guess, following upon Brandon's. I mean, with the entertainment company being set up to pursue the Sphere opportunities and sports appearing to have a much smaller need for cash, I was just wondering if we could get your latest thoughts on capital structure and capital allocation priorities for the two companies post-spin.

And then, secondly, just in terms of the extra time, you now anticipate needing to complete the spin transaction second half of this year, calendar year, how much of this is due to the government shutdown as opposed to other complexities in affecting a transaction like this?

Victoria Mink -- Executive Vice President and Chief Financial Officer

So, Bryan -- so -- though we're still working to determine the appropriate capital structure for each company, let me just share with you our current thinking on it. So, as you said, the entertainment company will be focused on expansion to the creation of the Spheres, starting in Las Vegas and then in London. So, it's really important that we make sure that, that company is appropriately capitalized to fund its growth initiatives.

But on the other hand, when you think about our sports business, that company possesses significant recurring revenue streams. We have the multi-year suites, sponsorships, the media rights agreements and it generates really solid free cash flow for us. So as a result, we currently envision the sports company potentially maintaining some debt, but ultimately, it's going to become more of a return of capital story. So hopefully, that's some helpful color. But we'll continue to keep you updated as we progress on this.

Andrew Lustgarten -- President

Bryan, so you asked about timing. Let me start. This is a significant transaction. We are working on it diligently. While we are saying second half of calendar 2019, I would not assume that that's December. This transaction takes time. There are many moving pieces, as well as a number of required approvals, the SEC, leagues, the IRS. But we're focused on moving forward. The most important thing I can tell you is that while we remain excited about this proposed spin-off, we continue to believe we would position both new companies for long-term success.

Bryan Goldberg -- Bank of America Merrill Lynch -- Analyst

Okay. Thank you very much.

Operator

Thank you. Your next question is from David Joyce of Evercore.

David Joyce -- Evercore ISI -- Analyst

Thank you. Two questions if I could. First, on the TAO Group. You did call out last quarter that you had some nibbles, some increases in labor costs as well as some pre-opening expenses. But could you really provide us some more color on how those TAO assets are performing financially?

And then, second, on the sports teams, given the trade announcements yesterday, if you could just kind of dispel the various media puts and takes on what's going on. Could you please provide your rationale for what you're doing with the personnel, the Knicks? Thank you.

Andrew Lustgarten -- President

So, let me -- once again a high level on TAO Group and then I'll pass to Victoria to give you a little bit more detail. Yes, we've given -- as we mentioned, we're not -- we haven't been thrilled with the recent financial performance. But we are very happy with them strategically. The TAO Group is -- we believe that TAO Group is the best premium hospitality in the US and probably in the world. Their expertise spans across restaurants, creating unique VIP experiences at around high-profile events.

They recently did an event at Sundance. They take over the VIP deck at EDC and a number of other festivals. And so we're very excited with what they can provide, and it's been great with what they've done here at Suite Sixteen. And they are pushing us on new premium products, and we're very thrilled with the way that they approach the world from that.

In terms of their financial performance, I'll let Victoria give you a little bit more.

Victoria Mink -- Executive Vice President and Chief Financial Officer

As Andy mentioned, the recent financial performance has not met our expectations. For the second quarter, revenues were roughly flat year-over-year. And the TAO Group continues to be impacted by higher expenses, their pre-opening costs related to new venues. We are responsible for nearly half of TAO's expense increase this quarter. Pre-opening costs are a normal course, normal part of our business and we do expect the payback period on that investment to be relatively quick.

And just as a reminder, we do report TAO's results on a three-month lag basis and our major new venue, TAO Chicago only opened in mid-September. So, we're now actively working with TAO management on ways to operate the business more efficiently. We're focusing on staff cost, product mix and some other efficiencies in order to help put the TAO Group back on the path to growth.

Andrew Lustgarten -- President

And then -- I think you asked a question about our next trip (ph). So, I'll start. We generally don't talk about player movements on these calls. We don't think it's appropriate. That said, this is a pretty big one and the timing I think -- I will give a little insight to how we think about it. Look, we believe we're saying exactly on where we're going on our path.

We're trying to build championship-caliber franchises. We traded a very talented player and few other very talented players for a very talented use. Two draft picks, which will, we believe drive us toward into the future, continuing to build our championship style teams -- caliber teams and tremendous financial flexibility. And so, we are very happy and look forward to hopefully bringing in a championship to New York.

David Joyce -- Evercore ISI -- Analyst

Great. Thank you very much.

Operator

Thank you. Your next question is from David Karnovsky of J.P Morgan.

David Karnofsky -- J.P. Morgan -- Analyst

Hi. Thank you. Just on the Christmas Spectacular. It looks like growth accelerated this year. How much of this is driven by creative changes to the show, which helped attendance versus say your ticket pricing strategies and then, what levers do you have to continue to drive growth ahead?

Andrew Lustgarten -- President

So the Christmas show continues to be -- continues to be very popular with guests, both returning new guests, tourists. I do also think it's a little bit, the statement of the whole live entertainment business. But that said, I think we've done better and outpaced other parts of the live entertainment business. We've been very focused on yield and shows timing and when is the best time to put on a show and we continue to be focused on it.

And we made a decision well into the run to add another week, which is something we haven't done. We haven't been past New Years and I think it was over 10 years. Don't quote me on that time frame. But it was something -- it was a long time since last time we did it. We did it because we felt very strong about how people were coming in to see the show.

And in terms of the new technology, when we go and ask the fans -- or sorry, the customers about what they thought about the show, the Rockettes has always ranked number one in terms of the most -- the highest rated part of the show. But for the first time ever, we've had technology come up and move up as one of the top ranked parts of the show. The New Finale was very well received and we'll always look to tweak the show a little bit. But we're feeling very good about what we've done, very good with Victoria Parker's lead on the new changes

David Karnofsky -- J.P. Morgan -- Analyst

Okay. And then I was hoping you could maybe give us your updated thoughts on sports betting and the opportunities you see there at a high level. And then more specifically, we saw some news that MSG had filed some trademarks related to interactive gambling. Just wondering, is that more to protect your brand? Or do you actually see an opportunity to launch some kind of consumer products? Thanks.

Andrew Lustgarten -- President

Let me start with the easier of the two questions and then I'll go to the longer question. In terms of the trademark, we just -- we are projecting our brand. It happens in many other industries and we do think our brand resonates across the world in sports. And so we thought it was prudent to protect the use of the brand in a -- something that's going to be so fundamental to consumer engagement going forward.

So now, talking about consumer engagement. We are very -- we've been really pleased with what we've seen in New Jersey and what's going on there with sports betting. We're happy with the first step in New York and think that as consumers continue to show their avidity to the teams and what sports betting does for consumer engagement, that we're going to continue to see the integration of sports betting here in the US and in the New York market.

And we're just -- we think that, as I've said this before and I'll say it again, we are thrilled that sports betting just simply from what it does for consumer engagement. On top of that, it puts us in a very unique position here in the New York market for sponsorship and other revenue opportunities. And we're very -- we're pleased with where it's going.

David Karnofsky -- J.P. Morgan -- Analyst

Okay. Thanks.

Operator

Thank you. Your next question is from Ben Swinburne of Morgan Stanley.

Benjamin Swinburne -- Morgan Stanley -- Analyst

Thanks. Good morning. Andy, could you talk about your outlook on the booking business, the concert business? I think the first half -- first quarter, we had a tough comp. But this quarter looks really strong. Can you give us a sense for how Q2 played out in that business and when you look at the year, what you've got booked so far? I think you said last quarter, you thought it would be a nice growth here. But just any update on how that business looks at this point and then I have a follow-up.

Andrew Lustgarten -- President

So, we are very bullish for our live entertainment business across our portfolio. We've been able to attract not only more events, but higher quality events. And though -- the truth is the whole entertainment industry, live entertainment industry is doing well, but we think we're doing very well.

Now the premium content is growing, artists increasingly need to tour and demand live experiences. And the Millennials and Gen Z really look to experience their favorite artist live, as well as the legacy acts who are bringing out all age generations. And we feel very good. We specifically benefit from where our venues are, the markets we're in, how we operate those venues and we continue to focus on multi-night and multi-venue events.

People like -- we recently announced the Tedeschi Trucks Band, playing across both, entering multi-year agreement in both the Beacon Theatre and Chicago Theatre. We expect to see more of those types of residences and we are very focused. Those take time to put together. But we're very focused. And as I said earlier, we drove double-digit percent increases in total events on the entertainment side. And last three years have been record setting for us and we look forward to another year of substantial growth.

Benjamin Swinburne -- Morgan Stanley -- Analyst

Got it. And then just going back to Sphere. Just to be specific, the change in time -- just want to make sure I understand. The change in timing in your view is from fiscal '21 to calendar '21 in terms of opening Vegas. Is that the change? Just want to make sure I understand exactly what the timing looks like from your point now.

Andrew Lustgarten -- President

Yes.

Benjamin Swinburne -- Morgan Stanley -- Analyst

Okay. Got it. Okay. Thank you very much.

Operator

Thank you. Your next question is from David Miller of Imperial Capital.

David Miller -- Imperial Capital -- Analyst

Yeah. Hey, guys. Congratulations on the stellar results. Andy, I'm wondering if there's been any progress made strategically in establishing a residency -- a concert residency out here in Los Angeles, specifically at the Forum. Obviously, there has been a lot of great acts out here that are identified with the West Coast, lot of like Los Angeles based bands, that would be fantastic candidates.

You've had tremendous success with Billy Joel, with the Billy Joel series at the Garden, obviously Jerry Seinfeld series at the Beacon Theatre comes to mind as well. Is it an issue of finding the right act? Or is it just an issue of time in a sense that you guys obviously have a lot of irons in the fire right now with the spin and Sphere and so on, so forth. I'm just wondering if there's any progress on that front. Thanks a lot.

Andrew Lustgarten -- President

So, you're right to focus on residences and how successful they've been. Billy has been -- it's his fifth year here at the Garden and going strong. Jerry just came back again at the Beacon Theatre. As I just mentioned, Tedeschi Trucks, which is our first multi-market residency, so it will be both in Beacon Theatre and Chicago Theatre for five years. I believe it's five years.

And so, in terms of the Forum, we are very focused on finding the right resident. That said, we haven't found the resident that works yet. It takes time. Residences are not -- those are not things that happen in the typical booking cycle. It's multi-year. Yeah. Artists who wants to be in the market, who feels it's -- it's just a -- it's a longer-dated pipeline. And -- but we're looking across all our venues to find the right resident. And we expect to -- once we can launch the Spheres, we'd be very focused on it both in London and in Vegas

Ari Danes -- Senior Vice President, Investor Relations and Treasury

Thanks for the question, David. Christie, we have time for one last caller.

Operator

Thank you. Your final question is coming from Amy Wong (sic) (Yong) of Macquarie.

Amy Yong -- Macquarie -- Analyst

Thanks. It's Amy Yong. Maybe just two housekeeping questions for Victoria. Victoria, can you share with us the proceeds from the Liberty sale? And maybe the miscellaneous line item on the P&L was fairly large this quarter. Thank you.

Victoria Mink -- Executive Vice President and Chief Financial Officer

Sure. Regarding the sale of Liberty, we are not disclosing the amount. As far as the sale itself in our ongoing operations, it's going to have an immaterial impact to our future results. And then regarding your question on the miscellaneous income, we own shares in a public company Townsquare Media, and we are required to mark our investment to market. And so it's based on the share price of that company as of our balance sheet date. And so there will be variability in that on a go-forward basis at each quarter-end

Amy Yong -- Macquarie -- Analyst

Got it. Thank you.

Operator

Thank you. I will now turn the call back to Ari Danes for any additional or closing remarks.

Ari Danes -- Senior Vice President, Investor Relations and Treasury

Thank you for joining us. We look forward to speaking with you on our next earnings call. Have a good day.

Operator

Thank you. This does conclude today's conference call. You may now disconnect.

Duration: 36 minutes

Call participants:

Ari Danes -- Senior Vice President, Investor Relations and Treasury

Andrew Lustgarten -- President

Victoria Mink -- Executive Vice President and Chief Financial Officer

Brandon Ross -- BTIG -- Analyst

Bryan Goldberg -- Bank of America Merrill Lynch -- Analyst

David Joyce -- Evercore ISI -- Analyst

David Karnofsky -- J.P. Morgan -- Analyst

Benjamin Swinburne -- Morgan Stanley -- Analyst

David Miller -- Imperial Capital -- Analyst

Amy Yong -- Macquarie -- Analyst

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