iHeartMedia 2004 Annual Report Download - page 41
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Divisional operating expenses increased $163.3 million during 2004 as compared to 2003. After an increase of $107.3 million due to
foreign exchange fluctuations, the majority of the remaining increase is tied to higher site lease expense and higher commission expenses in
2004, consistent with the growth in revenue. We also recorded a $4.1 million restructuring charge in Spain during the fourth quarter of 2004.
Additionally, $8.8 million of the increase in divisional operating expenses related to the consolidation of our outdoor advertising joint venture
in Australia, which was previously accounted for under the equity method.
Live Entertainment Results of Operations
Our live entertainment operating results were as follows:
Our live entertainment revenues grew $101.6 million during 2004 as compared to 2003. While show cancellations drove down the overall
number of amphitheater events in 2004, we saw an increase in sponsorships at these events, along with increased tour fees from outside
promoters which contributed to our revenue growth. We also saw revenue increases in Europe driven by increased tour fees from outside
promoters, as well as $74.3 million from foreign exchange fluctuations. Revenue from ticket sales was essentially unchanged during 2004 as
compared to 2003.
Divisional operating expenses increased $136.2 million during 2004 as compared to 2003. Driving the increase was talent costs, primarily
from higher artist guarantees and production costs. Also included in the increase is $68.1 million from foreign exchange fluctuations.
Reconciliation of Segment Operating Income (Loss)
38
Years Ended December 31, % Change
(In thousands) 2004 2003 2004 v. 2003
Revenue $2,748,598 $2,646,959 4%
Divisional operating expenses 2,592,074 2,455,897 6%
Depreciation and amortization 61,527 60,830 1%
Operating income $ 94,997 $ 130,232 (27%)
Years Ended December 31,
(In thousands) 2004 2003
Radio Broadcasting $1,431,881 $1,409,236
Outdoor Advertising 301,799 201,221
Live Entertainmen
t
94,997 130,232
Other 65,176 51,131
Corporate (219,423)(200,287)
Consolidated Operating Income $ 1,674,430 $ 1,591,533