Liberty Media shared the financial figures for the year 2021 in comparison to 2020 which included not only Q4 period but whole of 12 months too.
With the end of the year 2021, Liberty Media 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 2020. There was overall growth from numbers point of view.
Starting with the Q4 numbers, the total revenue of F1 stood at $787 millions in 2021 when compared to $485 millions in 2020. The increase in revenue was helped by the increased number of races and also fan attendance, especially on the Paddock Club side.
Moving on to the rejigged primary F1 revenue, the three months figure in 2021 stood at $615 million to 2020’s $439 million. At the same time, the other revenue saw a jump from $46 million to $172 million. This improvement came despite increase in team payments.
From $270 million in 2020, Liberty Media paid $378 million to teams in 2021. The operating income showed a positive $81 million figure in 2021 to a loss of $23 million in 2020. The total income after adjustment of OIBDA saw a jump from $78 million to $168 million in 2021.
Looking at the larger picture of the 12 months period, the total revenue of F1 stood at $2,136 million in 2021 from $1,145 million in 2020. At the same time, the primary revenue rose from $1,029 million to $1,850 in 2021 and others rose from $116 million to $286.
In terms of team payment, Liberty Media paid $1,068 million in 2021 to $711 it did in 2020. The operating income went from a loss of $386 million in 2020 to a positive figure of $92 million in 2021. The revenue after OIBDA was $466 million in 2021 from $18 million.
“2021 was a remarkable year for Formula 1 in all respects. The racing was spectacular and the business produced outstanding results,” said Stefano Domenicali. “We continue to build off this strong foundation and look forward to our record setting 23-race calendar for 2022 with new cars, regulations, races and drivers.”
Here’s the full explanation from Liberty Media regarding their growth in terms of finance in Q4 of F1 2021 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 (formerly referred to as broadcasting fees) and (iii) sponsorship fees. For the year ended December 31, 2021, these revenue streams comprised 31%, 40% and 16%, respectively, of total F1 revenue.
Beginning January 1, 2021, F1 began reclassifying certain components previously reported in Other F1 revenue into Primary F1 revenue to better align with the way it currently evaluates the business. In addition, broadcasting revenue was renamed media rights revenue. The more significant components that were reclassified into Primary F1 revenue include fees for F1 TV subscriptions, fees for licensing commercial rights for Formula 2 and Formula 3 races, fees for the origination and support of program footage, fees for broadcast rights for Formula 2 and Formula 3 races and fees for advertising rights on Formula 1’s digital platforms.
Following the reclassification, Other F1 revenue is primarily comprised of freight and hospitality revenue. There was $24 million and $65 million of Other F1 revenue reclassified as Primary F1 revenue for the three and twelve months ended December 31, 2020, respectively, to conform to the current period presentation. The impact of the revenue reclassification for the years ended December 31, 2019 and 2020 can be found in Schedule 4 of this press release.
There were 7 and 22 races held in the fourth quarter and full year 2021, respectively, compared to 7 and 17 races held in the fourth quarter and full year 2020 due to the compact schedule driven by the COVID-19 pandemic. Fan attendance continued to be assessed by relevant government authorities on a race-by-race basis throughout the year, with restrictions easing as the year progressed and significantly higher fan attendance beginning in the third quarter of 2021 compared to the prior year. The Paddock Club operated at only one event in 2020, and even then with strictly limited capacity, and resumed more normal operations in July 2021, operating at 6 races in the third quarter and 5 in the fourth quarter.
Primary F1 revenue grew in the fourth quarter, primarily driven by increased race promotion revenue compared to the prior year where limitations on fan attendance led to one-time changes in the contractual terms of races held. Media rights revenue was flat in the fourth quarter as contractual increases and growth in F1 TV subscription revenue were offset by the impact of lower proportionate recognition of season-based income in 2021 (7/22 races took place in the fourth quarter of 2021 compared to 7/17 in the fourth quarter of 2020). Sponsorship revenue increased in the fourth quarter driven by revenue from new sponsors in the current year and pandemic-related reductions to sponsorship revenue recognized in the prior year, where F1 honored one-time changes in certain sponsorship contracts due to the cancellation of races that had specific sponsorship-related inventory.
Primary F1 revenue grew for the full year with increases across all primary revenue streams. Race promotion revenue grew due to five more events held in 2021, including more non-European races, some of which saw the return of capacity crowds, whereas limitations on fan attendance in the prior year led to one-time changes in the contractual terms of races held. Race promotion revenue for the full year also benefited from a one-time settlement recognized in the first quarter related to the cancellation of a race originally scheduled to commence in 2020. Media rights revenue increased for the full year driven by higher broadcasting fees due to improved terms in certain new and renewed broadcasting agreements, other contractual rate increases, strong growth in F1 TV subscription revenue and the effect on the prior year of one-time changes in contract fees resulting from the pandemic and associated calendar disruptions. Sponsorship revenue increased due to revenue from new sponsors and the impact of more races held as well as pandemic-related reductions to sponsorship revenue recognized in the prior year.
Other F1 revenue increased in the fourth quarter and full year driven by hospitality revenue generated from the return of the Paddock Club, higher licensing revenue from new contracts and growth in gaming and merchandising royalties, as well as higher freight and travel income with more races held outside Europe compared to the prior year. Other F1 revenue for the full year also benefited from the additional races held.
Operating income and adjusted OIBDA grew in the fourth quarter and full year 2021. Team payments increased in both periods driven by the growth in Primary F1 revenue and the associated impact on the calculation of the team payments, which are 100% variable under the 2021 Concorde Agreement. Team payments in 2020 included one-time fees paid to teams upon signing the 2021 Concorde Agreement and certain fixed and minimum guaranteed payments to teams under the previous agreement.
Other cost of F1 revenue is largely variable in nature and mostly relates to revenue opportunities. These costs increased in the fourth quarter and full year due to costs associated with the operation of the Paddock Club and higher technical, freight and logistics, digital media and other related costs driven by five more races in the full year and the logistic costs of more non-European races. Selling, general and administrative expense increased in the fourth quarter and full year primarily due to higher personnel costs, discretionary marketing expenses and professional fees.
Here’s the Q3 report of F1 2021
Here’s how 2020 stood against 2019