Event costs such as artist fees and production service expenses are included in direct operating expenses and are typically substantial in relation to the revenue. Revenue is generally impacted by the number of events, volume of ticket sales and ticket prices. For each event, we either use a festival site we own or rent a third-party festival site. We earn revenue from the sale of tickets and typically pay artists a fixed guaranteed amount. We also earn revenue from the sale of concessions, camping fees, festival sponsorships and service charges earned on tickets sold. The artist manager negotiates on behalf of the artist and is paid a fee, generally as a percentage of the artist’s earnings.Īs a festival promoter, we typically book artists, secure festival sites, provide for third-party production services, sell tickets and advertise events to attract fans. We also provide or arrange for third parties to provide operational services as needed such as concessions, merchandising and security. Artist managers primarily provide services to music recording artists to manage their careers. Promoters can also reduce the risk of losses by entering into global or national touring agreements with artists and including the right to offset lower performing shows against higher performing shows on the tour in the determination of overall artist fees.
Promoters may renegotiate lower guarantees or cancel events because of insufficient ticket sales in order to reduce their losses. Under guaranteed payment formulas, promoters assume the risks of unprofitable events. In addition, promoters may also reimburse artists for certain costs of production, such as sound and lights. Artists are paid by the promoter under one of several different formulas, which may include fixed guarantees and/or a percentage of ticket sales or event profits. Promoters earn revenue primarily from the sale of tickets. Booking agents then contact promoters, who will contract with them or with artists directly, to arrange events. Typically, to initiate live music events or tours, booking agents contract with artists to represent them for defined periods. The live music industry includes concert promotion and/or production of music events or tours. Use of the words “may,” “should,” “continue,” “plan,” “potential,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “outlook,” “could,” “target,” “project,” “seek,” “predict,” or variations of such words and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. We have based our forward-looking statements on our beliefs and assumptions considering the information available to us at the time the statements are made.
Forward-looking statements include, but are not limited to, statements about our financial position, business strategy, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition, the effects of future legislation or regulations and plans and objectives of our management for future operations.
Certain statements contained in this Form 10-K (or otherwise made by us or on our behalf from time to time in other reports, filings with the SEC, news releases, conferences, internet postings or otherwise) that are not statements of historical fact constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, notwithstanding that such statements are not specifically identified.