Ticketmaster NZ profit climbs 59% as renamed Spark Arena boosts revenue
By Rebecca Howard
July 10 (BusinessDesk) - Ticketmaster New Zealand's annual profit rose 59 percent in 2016 as the booking agency benefited from increased revenues generated by the 12,000-seat Vector Arena, now renamed Spark Arena.
Net profit rose to $2.12 million in calendar 2016 from $1.33 million a year earlier as operating revenue climbed by 50 percent to $31.5 million, financial statements lodged with the Companies Office show. The accounts cover Ticketmaster and its controlled entities Live Nation NZ, EVENZ, NZ Venue and Event Management, QPAM and Quay Park Arena Management Trust NZ. The increase in sales was led by a more than doubling of 'other revenue' to $12 million in a year when telecommunications giant Spark took over the naming rights to Auckland's biggest indoor arena.
"The reason for the large increase in this revenue relates to QPAM/Vector Arena, which Ticketmaster provides the ticketing services for. The nature of this 'other revenue' includes catering revenue, ticketing revenue, merchandise and advertising/sponsorship," Ticketmaster said in an emailed response to questions.
Spark acquired the naming rights in May last year, refusing to say how much they paid citing commercial sensitivity, with the name officially changing in April of this year.
Vector was the previous rights holder signing a 10-year contract for an undisclosed sum in 2006, which was reported by the New Zealand Herald at the time to be worth $500,000 a year.
Ticketmaster's consolidated accounts had previously shown a $309,000 loss in the prior year, however, net profit in the year to December 2015 was understated by $1.6 million, while non-controlling interests were overstated by the same amount, it said. As a result, there was no net effect on closing equity, it said in the latest accounts.
On the other side of the ledger, the cost of sales rose to $15.24 million from $10.73 million in the prior year while total operating expenses jumped to $13.28 million from $8.93 million, partly due to higher employee expenses which rose to $4.38 million from $3.71 million in the prior 12 months.
Ticketmaster's parent company is Ticketmaster Australasia, and its ultimate parent entity is USA-based Live Nation Entertainment.