Liberty Media shared the financial figures for the year 2022 in comparison to 2021 which included not only the Q4 period but whole of 12 months too.
With the end of the year 2022, Liberty Media has presented its financial record for not only the last three months of last year but also the whole of 12 months when compared to the same period in 2021, with a solid growth as fans flock to F1 races in numbers.
Starting with the Q4 numbers, the total revenue of F1 stood at $754 millions in 2022 when compared to $787 millions in 2021. The drop in the ‘primary’ revenue was primarily due to one race held in 2022 with six when compared to 2021’s seven grands prix.
The primary revenue – race promotion revenue, media rights fees and sponsorship fees – in 2022 was down to $568 millions to 2021’s $615 millions. The other revenue increased to $186 millions in 2022 from $172 millions in 2021 due to Paddock Club increment and freight revenue.
The same period saw F1 pay the teams $319 millions in 2022 as opposed to $378 millions paid in 2021. The operating income dropped to $58 millions in 2022 than $81 millions in 2021, largely due to higher freight cost for Paddock Club plus marketing cost increment due to the preparation for the Las Vegas GP and one extra grand prix.
In same way, the total income of F1 after adjusted OIBDA dropped too to $135 millions in 2022 from $168 millions in 2021. Moving to the bigger picture of the whole year of 2022 as opposed to 2021, the total revenue increased to $2,573 millions in 2022 from $2,136 millions in 2021.
The primary income rose to $2,107 millions in 2022 from $1,850 millions, while the other revenue increased to $466 millions in 2022 from $286 millions in 2021. The F1 teams got more money due to increase in revenue, as they were paid $1,157 millions in 2022 as opposed to $1,068 millions they were paid in 2021.
The operating income saw a massive spike of 239% to $239 millions for the whole year in 2022 when compare to $92 millions in 2021. The total revenue after adjusted OIBDA was $566 millions in 2022 from $466 millions in 2021.
“Formula 1 saw record attendance at its races in 2022 and we were once again the fastest growing major sport on social media,” said Stefano Domenicali. “We are continuing to build fan engagement through our high-quality broadcast, enhanced content on F1 TV, social channels and new immersive experiences including the F1 Arcade and F1 Exhibition products.
“F1’s global relevance and sustainability efforts are enticing the entry of premier OEMs including Audi and Ford in 2026, and we are confident they will bring significant value to our sport. We look forward to a record 23 race calendar this year including, in particular, the inaugural Las Vegas Grand Prix.”
Here’s the full explanation from Liberty Media regarding their growth in terms of finance in Q4 of F1 2022 and also the 12 months:
Primary F1 revenue represents the majority of F1’s revenue and is derived from (i) race promotion revenue, (ii) media rights fees and (iii) sponsorship fees. For the year ended December 31, 2022, these revenue streams comprised 28.6%, 36.4% and 16.9%, respectively, of total F1 revenue.
There were 22 and 6 races held in the full year and fourth quarter of 2022, respectively, compared to 22 and 7 races held in the full year and fourth quarter of 2021. The 2021 season was impacted by the pandemic, with attendance at races limited particularly in the first half of the season. Restrictions on fan attendance reduced as 2021 progressed, with all races in the second half of the year operating at either full capacity or with limited restrictions. F1’s results in 2022 were not impacted by capacity limitations, and F1 had record growth in attendance in the grandstands and in the Paddock Club, with numbers well above pre-COVID-19 levels.
Primary F1 revenue grew for the full year with increases across all primary revenue streams. Race promotion revenue grew due to higher fees generated from the mix of events held, with three additional races held outside of Europe compared to 2021 and the return of capacity crowds, whereas limitations on fan attendance in 2021 led to one-time changes in the contractual terms of a limited number of races held. Media rights revenue increased for the full year due to growth in F1 TV subscription revenue and increased fees under new and renewed contractual agreements, and sponsorship revenue increased due to the recognition of revenue from new sponsors.
Primary F1 revenue decreased in the fourth quarter, driven by lower race promotion and media rights revenue primarily due to the impact of one less race held in the fourth quarter of 2022 compared to the prior year period. Race promotion revenue declined due to one less race held, as well as lower fees generated from the different mix of events on the calendar with only three of the same races occurring in both periods. Media rights revenue decreased as contractual increases and growth in F1 TV subscription revenue were offset by the impact of lower proportionate recognition of season-based income (6/22 races took place in the fourth quarter of 2022 compared to 7/22 in the fourth quarter of 2021). Sponsorship revenue increased as the recognition of revenue from new sponsors more than offset the impact of lower proportionate recognition of season-based income.
Other F1 revenue increased in the full year and fourth quarter driven by higher hospitality revenue generated from the Paddock Club, which operated at 19 races with record attendance throughout 2022 compared to 11 events during 2021, as well as higher freight revenue with more races held outside of Europe compared to the prior year and the impact of freight cost inflation on billing rates. Other F1 revenue for the full year also benefited from the ability to undertake a greater scope of activities than was possible in the pandemic-affected first half of 2021.
Operating income and adjusted OIBDA grew for the full year. Team payments increased for the full year driven by the growth in F1 revenue and the associated impact on the calculation of the team payments, which are 100% variable under the 2021 Concorde Agreement. Other cost of F1 revenue is largely variable in nature and is mostly derived from servicing both Primary and Other F1 revenue opportunities. These costs increased in the full year primarily driven by higher freight costs with three more events held outside of Europe and underlying inflation on freight costs, increased Paddock Club costs associated with higher hospitality attendance and servicing eight additional Paddock Club events compared to the prior year, as well as higher commissions and partner servicing costs associated with increased Primary F1 revenue streams and higher Formula 2 and Formula 3 related costs. Selling, general and administrative expense increased in the full year due to higher personnel and IT costs and increased legal and other advisory fees, as well as approximately $19 million of costs associated with the planning and launch of the Las Vegas Grand Prix.
Operating income and adjusted OIBDA decreased in the fourth quarter. Team payments decreased due to the impact of the pro rata recognition of such payments across the race season as one less race was held in the fourth quarter of 2022 compared to the prior year period. This was offset by increased Other cost of F1 revenue due to higher freight costs and costs associated with higher hospitality attendance in the Paddock Club. Selling, general and administrative expense increased in the fourth quarter primarily due to costs associated with the planning and launch of the Las Vegas Grand Prix.
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