Last September, MSG separated its sports-entertainment business and its media business. The media business includes MSG sports television networks, which became MSG Networks.
While the sports business, which included the New York Rangers and New York Knicks and the entertainment business, which encompasses organizing and hosting live events across different venues, such as Madison Square Garden and Radio City Music Hall in Manhattan, became the two reporting segments of the company.
For its quarter that ended on March 31, MSG posted a $60.8 million loss equal to $2.47 per share, in comparison to an $11.5 million loss equal to 46 cents per share, for the same period one year earlier. Revenue expanded by 12% to end the quarter just over $336.2 million.
Analysts were expecting the company to post a loss of 34 cents per share with revenue coming in at just over $325 million.
Revenue for the MSG sports business, which represents close to 80% of its top line, expanded by 10%, while there was a gain of 22% in the entertainment business, compared to the same three-month period during 2015.
Revenue from its sports segment increased due to higher rights fees for broadcasting from the different MSG Networks due to the new media rights agreements that are long term between the Rangers and Knicks and the MSG Networks.
The increase in entertainment was due primarily to higher revenues related to events at all of the venues of the company. The increase was offset partially by an impact of changing the spring show of the The Radio City Rockettes to a show held in the summer.
During the quarter, MSG took a write down of $41.8 million for costs of production due to its decision not to include certain scenes previously created in the production during the summer.
Shares, which have increased by over 9.7% during the last three months, did not show any activity during premarket trading on Friday morning.
On Wednesday, MSG Networks posted profit that surged by 12% in its most recent three-month period and a rise that was surprising in its top line, that was helped by the growth in advertising and affiliate revenue.
The long-term broadcasting rights agreements will help give the company a base to work from as it looks to increase its events revenue and overall income.