Ticketmaster New Zealand, which has a controlling interest in the soon-to-be-renamed Vector Arena, turned to an annual loss in 2015, despite revenue growing, with operating expenses spiking.
The consolidated accounts, which cover Ticketmaster and its controlled entities Live Nation NZ, EVENZ, NZ Venue and Event Management, QPAM and Quay Park Arena Management Trust NZ, showed the company booked a $309,000 loss in the year to Dec. 31, 2015, compared to a profit of $770,000 in 2014.
Across its various subsidiaries, the group was involved with event ticket sales, concert and event promotion, arena rental and event hosting and catering services, notes to the 2015 accounts say.
Consolidated operating revenue rose 39 per cent to $21 million, while cost of sales advanced 50 per cent to $10.8 million and operating expenses rose 54 per cent to $10.5 million. Within cost of sales, licence costs more than doubled to $2 million in 2015 and the consolidated group booked $2.9 million in event costs, from nothing in 2014.
Operating costs were driven by a 34 per cent increase in employee expenses to $3.3 million, while operating lease rentals rose from $228,000 in 2014 to $1.1 million in the year. Unspecified other expenses doubled to $2.8 million.
Subsidiary Live Nation NZ bought 50.8 per cent of EVENZ, an unlisted venue management company which runs Auckland's Vector Arena, in August 2015. Ticketmaster NZ gained $15.7 million in consideration transferred from the acquisition, it said, with $13.6 million of that from goodwill.
That acquisition was cleared last year by the Overseas Investment Office, with Live Nation NZ and MHC Investments, an investment vehicle of concert promoters Michael Coppel and Michelle Coppel, buying the 12,000-seat venue's operating company, which has a development agreement with Auckland Council-controlled Regional Facilities Auckland to return the arena to council after 40 years.
Ticketmaster's parent company is Ticketmaster Australasia, and its ultimate parent entity is USA-based Live Nation Entertainment. In 2015, the local company paid just under $6 million to related parties primarily in licence fees to US-based Ticketmaster Entertainment as well as support service fees to Ticketmaster UK, while it received $780,000 from related parties.
After reporting the loss, Ticketmaster received an income tax benefit of $50,000.