Liberty Media has posted a positive income for Quarter 4 as well as the 12 months of F1 for the 2019 season in their year-end financial booklet.
After posting increased revenues in Q1 and Q2, Liberty Media posted a decreased revenue in Q3 the last time but it has increased again in Q4 of the 2019 F1 season. The overall income for the 12 months has also increased as per the financial statement.
The total revenue for the three months jumped from $481 million to $523, while for 12 months from 2018 to 2019, it increased from $1,827 million to $2,022. Both primary and other F1 revenue increased for three and 12 months, respectively.
The former saw a jump from $351 million to $382 in terms of primary, while other went from $131 million to $141. As for the latter, the primary went from $1,487 million to $1,664 and the other jumped from $340 million to $358.
The team payments actually increased, not just for the three months period but also for the whole 12 months. The operating income showed a loss for the three months but it decreased from $12 million to $6, while it was positive for 12 months period.
From a negative $68 million, it went to a positive $17 for the 21 races held. Here’s the full explanation from Liberty Media regarding their growth in terms of finance in the 12 months:
“Primary F1 revenue represents the majority of F1’s revenue and is derived from (i) race promotion fees, (ii) broadcasting fees and (iii) advertising and sponsorship fees. For the year ended December 31, 2019, these revenue streams comprised 30%, 38% and 15%, respectively, of total F1 revenue.
“Primary F1 revenue grew in both the fourth quarter and full year 2019. Broadcast revenue increased in the fourth quarter and full year due to contractual rate increases, partially offset by the impact of weaker foreign exchange rates. Advertising and sponsorship revenue was relatively flat in the fourth quarter, and advertising and sponsorship revenue grew in the full year due to revenue from new sponsorship agreements.
“Growth in these revenue streams was partially offset by a decline in race promotion revenue in both the fourth quarter and full year. The fourth quarter decline in race promotion revenue was primarily due to the renewal terms of one contract, and the full year decline was driven by the impact of renewal terms of two contracts and weaker prevailing foreign exchange rates.
“Other F1 revenue increased in the fourth quarter and full year 2019 driven by increases in digital media revenue, higher Paddock Club attendance, increased revenue from other event-based activities and higher sales of equipment, parts and maintenance to F2 and F3 teams.
“Operating income grew in the fourth quarter and full year 2019. Adjusted OIBDA increased in the fourth quarter and full year due to the aforementioned revenue growth, partially offset by elevated costs. Team payments increased in the fourth quarter and full year driven by the growth in F1 revenue and the associated impact on variable elements of team payments.
“Other cost of F1 revenue increased in the fourth quarter and full year due to various technical initiatives, the continued further development and delivery of digital and social media products and platforms, increased costs related to the sale of equipment, parts, maintenance and other services provided to F2 and F3 teams and higher FIA fees.
“Selling, general and administrative expense decreased in the fourth quarter and full year driven by lower bad debt expense and foreign exchange gains, partially offset by higher personnel and information technology costs.”
Speaking about the growth, F1 boss Chase Carey stated: “Formula 1 continues to benefit from the investments made in the business over the past few years. We see this in the strong financial results, viewership, attendance and engagement.
“2020 marks the 70th anniversary of the sport, which will provide further momentum. We are excited to welcome two new Grands Prix to the calendar in Vietnam and the Netherlands and welcome second season of the Netflix series ‘Formula 1: Drive to Survive’, which went live on February 28.”
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