WWE’s Second Quarter Conference Call Recap:
-The call is hosted by WWE Chairman Vince McMahon, WWE CFO George Barrios, and WWE Investor Relations Michael Weitz.
-Vince said there was no point in dwelling on their performance “or lack of it.” He added, “We do know what we’re doing, by the way.” Vince spoke of WrestleMania 29 being the highest grossing WrestleMania to date.
Vince spoke about getting into the reality show business. “We think we do it well and we think we have something under our belt to prove we do it well,” he said regarding Total Divas. He indicated that they hope to do more in the reality television genre.
-McMahon spoke about WWE proving via PG programming that they are a safe environment to be associated with. He spoke about Kmart and other business partners.
-Regarding the app and other social media, Vince said they are teaching the television audience how to watch television all over again. He said others in entertainment will try to do the same thing but no one does it like they do.
-Vince spoke about the WWE Performance Center. He praised the talent they have in the developmental system.
-Barrios ran through the financial report presentation. He spoke about the television rights fees improvement and once again touted Total Divas.
-The Fan Axxess event added 2.3 million to the live events revenue.
-Revenue for The Call won’t be available until later in the year. They expect to see a profit of $5.9 million off of a $1 million investment.
-Barrios said the cash flow was down due to an $11 million increase in management compensation.
-Barrios said their market research is favorable for the WWE Network. He said that over the next 18 months, they expect to renegotiate their largest television rights fees in the U.S., UK, and India.
-They opened up the phone lines for questions. The first caller asked for an update regarding the WWE Network and their approach. Vince said all options are open to them. He said the rights fees coming up could be tied to the network.
-The topic of rising ticket prices was brought up and they were asked whether they are driving some fans away. Barrios said the increases come at the premium seating level, whereas the lowest ticket prices have remained the same.
-A caller asked Vince to step back and speak about what he’s learned regarding the film industry over the last few years. Vince said they’ve tried a lot of models and they feel they have the right model now. He also praised Michael Luisi, who is heading up the division. Vince said the division is making money for them now and broadens the WWE brand. The caller said it feels better to have the WWE talent in secondary roles. Vince said that talent can be the stars of straight to DVD. He said he hopes that the talent has strong supporting roles in the theatrical releases while they learn how to become the stars.
-The caller noted the “ridiculous” programming fees that are being paid for low level sporting events and questioned how WWE couldn’t double what they get from USA Network for Raw. Vince said the caller answered his own question and feels they are poised
-A caller asked a question about Rock’s pay for WrestleMania 29, but they said they didn’t want to get into who was paid what.
-Vince said they get closer with the network each quarter.
-Barrios said that when you factor in everything, including Fan Axxess, WrestleMania profits were down roughly $1 million.
-A caller asked about the cost of the WWE Performance Center and the talent costs. Barrios said the spending happened predominantly in the first half of the year. He estimated between 50 and 100 developmental talents.
-Vince said he would allow a caller to put a hammerlock on him if they don’t deliver in their negotiations for improved television programming fees. The call wrapped up shortly thereafter.