Madison Square Garden Sports Corp. Q2 FY2024 earnings call

• NBA and NHL seasons over halfway complete with positive operating momentum; Knicks and Rangers had strong starts, with Knicks in NBA in-season tournament and All-Stars, Rangers in NHL All-Star game. • Per game revenues up in key categories despite fewer home games. • Season ticket renewal rate above 94%, average paid attendance up. • Strong fan engagement with food/beverage and merchandise per capita spending up ~10%. • New merchandise offerings and fan experiences; 29 million impressions from season tip-off event. • New marketing partners added, including Beyond Meat, Pfizer, etc.; new sponsorship relationship with Oak View Group and Crown Properties Collection. • Record suite revenues due to strong sales and new premium products; two new event-level suites at the Garden. • Media rights benefiting from annual contractual escalators; NBA national rights renewal ahead; local viewership up double digits. • Third-party valuations of NBA and NHL teams increased, reinforcing confidence in franchise value.

Fiscal second quarter revenues were approximately $327 million with adjusted operating income of $37 million. Despite nine fewer Knicks and Rangers home games at the Garden vs prior year, per game revenues in categories like tickets, suites, food & beverage, and merchandise were up. National and local media rights fees increased 4%. Event-related revenues were $122.4 million, suites and sponsorship revenues were $69.3 million, and media rights fees were $122.5 million. Adjusted operating income included $9 million of noncash arena license fee expense vs $12.2 million prior year.

• Expect revenue growth in fiscal '24 excluding playoffs. • AOI to reflect revenue growth plus higher team operations expenses and league-related costs. • As of Dec 31, cash balance $38 million, debt balance $360 million; liquidity $233 million (unrestricted cash $38M, borrowing capacity $195M).

• Media landscape evolution could impact media rights and distribution. • MSG Networks has a material debt maturity in October which could pose challenges. • Potential impact of league-related costs and team personnel expenses on financials.

Q: On RSN distribution and MSG Networks debt maturity, any role for MSG Sports?

A: Believes in value of live sports content, supportive of MSG Networks' distribution efforts including MSG+.

Q: On Sphere jersey patch agreement, details?

A: Won't share specifics but proud of partnership between two global sports entertainment brands.

Q: On closing stock price gap, plans?

A: Focus on maximizing ticket revenue, premium hospitality, sponsorships, fan engagement; no current minority stake sale to report.

Q: On ticket sales breakdown and sponsorship mix?

A: Season ticket renewal rate over 94%, group and individual ticket sales strong; new sponsors added, partnership with Oak View Group to expand sponsorships.

Q: On NBA national rights renewal and revenue flows?

A: All teams share national media rights fees, players receive ~50% of league-wide revenues; local rights contracts with MSG Networks run through 2034-35.