|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
27-0624498
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
þ
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
Class A Common Stock par value $0.01 per share
|
—
|
62,880,994
|
Class B Common Stock par value $0.01 per share
|
—
|
13,588,555
|
|
|
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2012 |
|
June 30,
2012 |
||||
|
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
|
||||
Current Assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
248,594
|
|
|
$
|
206,500
|
|
Restricted cash
|
|
250
|
|
|
5,789
|
|
||
Accounts receivable, net of allowance for doubtful accounts of
$2,327 and $2
,434 as of December 31, 2012 and
June 30, 2012, respectively
|
|
132,811
|
|
|
126,565
|
|
||
Net related party receivables
|
|
27,019
|
|
|
27,277
|
|
||
Prepaid expenses
|
|
60,363
|
|
|
29,700
|
|
||
Other current assets
|
|
19,166
|
|
|
19,980
|
|
||
Total current assets
|
|
488,203
|
|
|
415,811
|
|
||
Property and equipment, net of accumulated depreciation and amortization of $436,922 and $435,696 as of
December 31, 2012 and June 30, 2012, respectively
|
|
1,075,107
|
|
|
969,528
|
|
||
Amortizable intangible assets, net of accumulated amortization
of $79,874 and
$122,210 as of December 31, 2012
and June 30, 2012, respectively
|
|
95,905
|
|
|
101,814
|
|
||
Indefinite-lived intangible assets
|
|
158,636
|
|
|
158,636
|
|
||
Goodwill
|
|
742,492
|
|
|
742,492
|
|
||
Other assets
|
|
135,560
|
|
|
136,403
|
|
||
|
|
$
|
2,695,903
|
|
|
$
|
2,524,684
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
||||
Current Liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
17,985
|
|
|
$
|
33,048
|
|
Net related party payables
|
|
376
|
|
|
362
|
|
||
Accrued liabilities:
|
|
|
|
|
||||
Employee related costs
|
|
68,834
|
|
|
82,886
|
|
||
Other accrued liabilities
|
|
215,716
|
|
|
188,410
|
|
||
Deferred revenue
|
|
295,897
|
|
|
211,639
|
|
||
Total current liabilities
|
|
598,808
|
|
|
516,345
|
|
||
Defined benefit and other postretirement obligations
|
|
62,290
|
|
|
58,817
|
|
||
Other employee related costs
|
|
40,176
|
|
|
36,689
|
|
||
Other liabilities
|
|
58,177
|
|
|
60,438
|
|
||
Deferred tax liability
|
|
539,387
|
|
|
532,382
|
|
||
Total liabilities
|
|
1,298,838
|
|
|
1,204,671
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
|
||||
Stockholders' Equity:
|
|
|
|
|
||||
Class A Common stock, par value $0.01, 360,000 shares authorized; 62,880 and 62,016 shares outstanding as of
December 31, 2012 and June 30, 2012, respectively
|
|
637
|
|
|
628
|
|
||
Class B Common stock, par value $0.01, 90,000 shares authorized; 13,589 shares outstanding as of December 31,
2012 and June 30, 2012
|
|
136
|
|
|
136
|
|
||
Preferred stock, par value $0.01, 45,000 shares authorized; none outstanding
|
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
|
1,078,693
|
|
|
1,070,046
|
|
||
Treasury stock, at cost, 927 shares as of December 31, 2012 and June 30, 2012
|
|
(22,047
|
)
|
|
(22,047
|
)
|
||
Retained earnings
|
|
362,928
|
|
|
295,412
|
|
||
Accumulated other comprehensive loss
|
|
(23,282
|
)
|
|
(24,162
|
)
|
||
Total stockholders' equity
|
|
1,397,065
|
|
|
1,320,013
|
|
||
|
|
$
|
2,695,903
|
|
|
$
|
2,524,684
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
December 31,
|
|
December 31,
|
|||||||||||||
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|||||||||
Revenues (including related party revenues of $42,438 and $41,537 for the three months ended December 31, 2012 and 2011, respectively, and $85,102 and $81,495 for the six months ended December 31, 2012 and 2011, respectively)
|
|
$
|
387,886
|
|
|
$
|
373,007
|
|
|
$
|
592,052
|
|
|
$
|
550,646
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Direct operating (including related party expenses of $3,416 and $3,605 for the three months ended December 31, 2012 and 2011, respectively, and $6,395 and $6,538 for the six months ended December 31, 2012 and 2011, respectively)
|
|
207,177
|
|
|
224,914
|
|
|
279,918
|
|
|
296,398
|
|
||||
Selling, general and administrative (including related party expenses of $3,673 and $2,564 for the three months ended December 31, 2012 and 2011, respectively, and $6,522 and $4,547 for the six months ended December 31, 2012 and 2011, respectively)
|
|
77,942
|
|
|
76,043
|
|
|
149,477
|
|
|
139,471
|
|
||||
Depreciation and amortization (including impairments)
|
|
21,744
|
|
|
24,094
|
|
|
41,444
|
|
|
40,458
|
|
||||
|
|
306,863
|
|
|
325,051
|
|
|
470,839
|
|
|
476,327
|
|
||||
Operating income
|
|
81,023
|
|
|
47,956
|
|
|
121,213
|
|
|
74,319
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
571
|
|
|
580
|
|
|
1,152
|
|
|
1,127
|
|
||||
Interest expense
|
|
(1,855
|
)
|
|
(1,891
|
)
|
|
(3,566
|
)
|
|
(3,640
|
)
|
||||
Miscellaneous
|
|
66
|
|
|
—
|
|
|
102
|
|
|
—
|
|
||||
|
|
(1,218
|
)
|
|
(1,311
|
)
|
|
(2,312
|
)
|
|
(2,513
|
)
|
||||
Income from operations before income taxes
|
|
79,805
|
|
|
46,645
|
|
|
118,901
|
|
|
71,806
|
|
||||
Income tax expense
|
|
(32,894
|
)
|
|
(21,026
|
)
|
|
(51,385
|
)
|
|
(24,899
|
)
|
||||
Net income
|
|
$
|
46,911
|
|
|
$
|
25,619
|
|
|
$
|
67,516
|
|
|
$
|
46,907
|
|
Basic earnings per common share
|
|
$
|
0.62
|
|
|
$
|
0.34
|
|
|
$
|
0.89
|
|
|
$
|
0.63
|
|
Diluted earnings per common share
|
|
$
|
0.60
|
|
|
$
|
0.33
|
|
|
$
|
0.87
|
|
|
$
|
0.61
|
|
Weighted-average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
75,914
|
|
|
74,632
|
|
|
75,770
|
|
|
74,573
|
|
||||
Diluted
|
|
77,889
|
|
|
77,379
|
|
|
77,829
|
|
|
77,283
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||||||||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||||||||||||
Net income
|
|
|
|
$
|
46,911
|
|
|
|
|
$
|
25,619
|
|
|
|
|
$
|
67,516
|
|
|
|
|
$
|
46,907
|
|
||||||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Pension plans and postretirement plan:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Amortization of net actuarial loss included in net periodic benefit cost
|
|
$
|
314
|
|
|
|
|
$
|
288
|
|
|
|
|
$
|
628
|
|
|
|
|
$
|
583
|
|
|
|
||||||||
Amortization of net prior service credit included in net periodic benefit cost
|
|
(20
|
)
|
|
294
|
|
|
(28
|
)
|
|
260
|
|
|
(40
|
)
|
|
588
|
|
|
(44
|
)
|
|
539
|
|
||||||||
Unrealized gain (loss) on available-for-sale securities
|
|
|
|
1,574
|
|
|
|
|
675
|
|
|
|
|
292
|
|
|
|
|
(7,111
|
)
|
||||||||||||
Other comprehensive income (loss)
|
|
|
|
1,868
|
|
|
|
|
935
|
|
|
|
|
880
|
|
|
|
|
(6,572
|
)
|
||||||||||||
Comprehensive income
|
|
|
|
$
|
48,779
|
|
|
|
|
$
|
26,554
|
|
|
|
|
$
|
68,396
|
|
|
|
|
$
|
40,335
|
|
|
|
Six Months Ended
|
||||||
|
|
December 31,
|
||||||
|
|
2012
|
|
2011
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
67,516
|
|
|
$
|
46,907
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization (including impairments)
|
|
41,444
|
|
|
40,458
|
|
||
Impairment of deferred costs
|
|
4,982
|
|
|
—
|
|
||
Amortization of deferred financing costs
|
|
1,090
|
|
|
1,090
|
|
||
Share-based compensation expense related to equity classified awards
|
|
8,896
|
|
|
10,579
|
|
||
Excess tax benefit on share-based awards
|
|
(180
|
)
|
|
(306
|
)
|
||
Provision for doubtful accounts
|
|
143
|
|
|
330
|
|
||
Change in assets and liabilities:
|
|
|
|
|
||||
Accounts receivable, net
|
|
(6,308
|
)
|
|
(18,797
|
)
|
||
Net related party receivables
|
|
3,037
|
|
|
(2,850
|
)
|
||
Prepaid expenses and other assets
|
|
(29,030
|
)
|
|
(29,598
|
)
|
||
Accounts payable
|
|
(12,764
|
)
|
|
14,436
|
|
||
Net related party payables
|
|
14
|
|
|
374
|
|
||
Accrued and other liabilities
|
|
34,514
|
|
|
38,742
|
|
||
Deferred revenue
|
|
84,258
|
|
|
76,078
|
|
||
Deferred income taxes
|
|
6,353
|
|
|
3,504
|
|
||
Net cash provided by operating activities
|
|
203,965
|
|
|
180,947
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Capital expenditures
|
|
(159,313
|
)
|
|
(265,871
|
)
|
||
Payments for acquisition of assets
|
|
—
|
|
|
(2,627
|
)
|
||
Net cash used in investing activities
|
|
(159,313
|
)
|
|
(268,498
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Proceeds from loans
|
|
—
|
|
|
4,236
|
|
||
Principal payments on capital lease obligations
|
|
(148
|
)
|
|
(722
|
)
|
||
Proceeds from stock option exercises
|
|
3,135
|
|
|
497
|
|
||
Acquisition of restricted shares
|
|
—
|
|
|
(224
|
)
|
||
Tax withholding associated with vested Restricted Stock Units
|
|
(88
|
)
|
|
—
|
|
||
Tax withholding associated with exercise of stock options
|
|
(5,637
|
)
|
|
—
|
|
||
Excess tax benefit on share-based awards
|
|
180
|
|
|
306
|
|
||
Net cash provided by (used in) financing activities
|
|
(2,558
|
)
|
|
4,093
|
|
||
Net increase (decrease) in cash and cash equivalents
|
|
42,094
|
|
|
(83,458
|
)
|
||
Cash and cash equivalents at beginning of period
|
|
206,500
|
|
|
304,876
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
248,594
|
|
|
$
|
221,418
|
|
|
|
|
|
|
||||
Non-cash investing and financing activities:
|
|
|
|
|
||||
Capital expenditures incurred but not yet paid
|
|
$
|
20,470
|
|
|
$
|
111,742
|
|
Leasehold improvements paid by landlord
|
|
—
|
|
|
1,786
|
|
||
Cash due from related party associated with exercise of stock options
|
|
2,779
|
|
|
1,240
|
|
|
|
Common
Stock
Issued
|
|
Additional
Paid-In
Capital
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
||||||||||||
Balance as of June 30, 2012
|
|
$
|
764
|
|
|
$
|
1,070,046
|
|
|
$
|
(22,047
|
)
|
|
$
|
295,412
|
|
|
$
|
(24,162
|
)
|
|
$
|
1,320,013
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,516
|
|
|
—
|
|
|
67,516
|
|
||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
880
|
|
|
880
|
|
||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
68,396
|
|
|||||||||||
Exercise of options
|
|
9
|
|
|
5,986
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,995
|
|
||||||
Share-based compensation expense
|
|
—
|
|
|
8,896
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,896
|
|
||||||
Tax withholding associated with vested
Restricted Stock Units
|
|
—
|
|
|
(88
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(88
|
)
|
||||||
Tax withholding associated with exercise of stock options
|
|
—
|
|
|
(5,637
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,637
|
)
|
||||||
Excess tax benefit on share-based
awards, net
|
|
—
|
|
|
(510
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(510
|
)
|
||||||
Balance as of December 31, 2012
|
|
$
|
773
|
|
|
$
|
1,078,693
|
|
|
$
|
(22,047
|
)
|
|
$
|
362,928
|
|
|
$
|
(23,282
|
)
|
|
$
|
1,397,065
|
|
|
|
Common
Stock
Issued
|
|
Additional
Paid-In
Capital
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total
|
||||||||||||
Balance as of June 30, 2011
|
|
$
|
761
|
|
|
$
|
1,041,769
|
|
|
$
|
(10,279
|
)
|
|
$
|
188,867
|
|
|
$
|
(15,233
|
)
|
|
$
|
1,205,885
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,907
|
|
|
—
|
|
|
46,907
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,572
|
)
|
|
(6,572
|
)
|
||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
40,335
|
|
|||||||||||
Exercise of options
|
|
2
|
|
|
1,735
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,737
|
|
||||||
Share-based compensation expense
|
|
—
|
|
|
10,579
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,579
|
|
||||||
Treasury stock acquired from acquisition
of restricted shares
|
|
—
|
|
|
—
|
|
|
(534
|
)
|
|
—
|
|
|
—
|
|
|
(534
|
)
|
||||||
Excess tax benefit on share-based
awards
|
|
—
|
|
|
306
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
306
|
|
||||||
Balance as of December 31, 2011
|
|
$
|
763
|
|
|
$
|
1,054,389
|
|
|
$
|
(10,813
|
)
|
|
$
|
235,774
|
|
|
$
|
(21,805
|
)
|
|
$
|
1,258,308
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
December 31,
|
|
December 31,
|
||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||
Weighted-average shares for basic EPS
|
|
75,914
|
|
|
74,632
|
|
|
75,770
|
|
|
74,573
|
|
Dilutive effect of shares issuable under share-based compensation plans
and shares restricted on the same basis as underlying Cablevision
restricted shares
|
|
1,975
|
|
|
2,747
|
|
|
2,059
|
|
|
2,710
|
|
Weighted-average shares for diluted EPS
|
|
77,889
|
|
|
77,379
|
|
|
77,829
|
|
|
77,283
|
|
Anti-dilutive shares
|
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
December 31,
|
|
December 31,
|
||||||||||||
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Provisions for Team Personnel Transactions
|
$
|
2,535
|
|
|
$
|
9,895
|
|
|
$
|
3,130
|
|
|
$
|
9,895
|
|
Insurance recoveries related to non season-ending player injuries
|
—
|
|
|
323
|
|
|
—
|
|
|
323
|
|
MSG Media
|
$
|
465,326
|
|
MSG Entertainment
|
58,979
|
|
|
MSG Sports
|
218,187
|
|
|
|
$
|
742,492
|
|
Sports franchises (MSG Sports segment)
|
$
|
96,215
|
|
Trademarks (MSG Entertainment segment)
|
62,421
|
|
|
|
$
|
158,636
|
|
December 31, 2012
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||
Affiliate relationships
|
|
$
|
83,044
|
|
|
$
|
(26,810
|
)
|
|
$
|
56,234
|
|
Season ticket holder relationships
|
|
73,124
|
|
|
(40,772
|
)
|
|
32,352
|
|
|||
Suite holder relationships
|
|
15,394
|
|
|
(10,841
|
)
|
|
4,553
|
|
|||
Other intangibles
|
|
4,217
|
|
|
(1,451
|
)
|
|
2,766
|
|
|||
|
|
$
|
175,779
|
|
|
$
|
(79,874
|
)
|
|
$
|
95,905
|
|
June 30, 2012
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||
Affiliation agreements and affiliate relationships
|
|
$
|
106,677
|
|
|
$
|
(48,357
|
)
|
|
$
|
58,320
|
|
Season ticket holder relationships
|
|
75,005
|
|
|
(39,994
|
)
|
|
35,011
|
|
|||
Suite holder relationships
|
|
15,394
|
|
|
(10,142
|
)
|
|
5,252
|
|
|||
Broadcast rights
|
|
15,209
|
|
|
(14,992
|
)
|
|
217
|
|
|||
Other intangibles
|
|
11,739
|
|
|
(8,725
|
)
|
|
3,014
|
|
|||
|
|
$
|
224,024
|
|
|
$
|
(122,210
|
)
|
|
$
|
101,814
|
|
|
Estimated
Useful Lives
|
Affiliate relationships
|
24 years
|
Season ticket holder relationships
|
12 to 15 years
|
Suite holder relationships
|
11 years
|
Other intangibles
|
15 years
|
|
|
December 31,
2012 |
|
June 30,
2012 |
||||
Land
|
|
$
|
92,828
|
|
|
$
|
92,828
|
|
Buildings
|
|
791,185
|
|
|
604,504
|
|
||
Equipment
|
|
315,015
|
|
|
287,841
|
|
||
Aircraft
|
|
42,961
|
|
|
42,961
|
|
||
Furniture and fixtures
|
|
44,000
|
|
|
25,592
|
|
||
Leasehold improvements
|
|
151,645
|
|
|
148,572
|
|
||
Construction in progress
(a)
|
|
74,395
|
|
|
202,926
|
|
||
|
|
1,512,029
|
|
|
1,405,224
|
|
||
Less accumulated depreciation and amortization
|
|
(436,922
|
)
|
|
(435,696
|
)
|
||
|
|
$
|
1,075,107
|
|
|
$
|
969,528
|
|
(a)
|
Construction in progress primarily relates to the Transformation.
|
Balance as of June 30, 2012
|
$
|
12,218
|
|
Accretion expense
|
7
|
|
|
Payments
|
(2,268
|
)
|
|
Balance as of December 31, 2012
|
$
|
9,957
|
|
|
|
December 31,
2012 |
|
June 30,
2012 |
||||
Revolving Credit Facility
|
|
$
|
—
|
|
|
$
|
—
|
|
Related party capital lease obligations
(a)
|
|
3,213
|
|
|
3,361
|
|
||
Total
|
|
$
|
3,213
|
|
|
$
|
3,361
|
|
(a)
|
Classified in other accrued liabilities and other liabilities in the accompanying consolidated balance sheets.
|
•
|
Level I — Quoted prices for identical instruments in active markets.
|
•
|
Level II — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.
|
•
|
Level III — Instruments whose significant value drivers are unobservable.
|
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market accounts
|
|
$
|
148,856
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
148,856
|
|
Time deposits
|
|
90,819
|
|
|
—
|
|
|
—
|
|
|
90,819
|
|
||||
Available-for-sale securities (in other assets)
|
|
36,428
|
|
|
—
|
|
|
—
|
|
|
36,428
|
|
||||
Total assets measured at fair value
|
|
$
|
276,103
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
276,103
|
|
June 30, 2012
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market accounts
|
|
$
|
79,994
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
79,994
|
|
Time deposits
|
|
120,629
|
|
|
—
|
|
|
—
|
|
|
120,629
|
|
||||
Available-for-sale securities (in other assets)
|
|
35,919
|
|
|
—
|
|
|
—
|
|
|
35,919
|
|
||||
Total assets measured at fair value
|
|
$
|
236,542
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
236,542
|
|
|
|
Pension Plans and
Postretirement
Plan
|
|
Unrealized
Gain (Loss) on
Available-for-sale
Securities
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
||||||
Balance as of June 30, 2012
|
|
$
|
(21,216
|
)
|
|
$
|
(2,946
|
)
|
|
$
|
(24,162
|
)
|
Other comprehensive income
|
|
1,023
|
|
|
509
|
|
|
1,532
|
|
|||
Tax expense
|
|
(435
|
)
|
|
(217
|
)
|
|
(652
|
)
|
|||
Balance as of December 31, 2012
|
|
$
|
(20,628
|
)
|
|
$
|
(2,654
|
)
|
|
$
|
(23,282
|
)
|
|
|
|
|
|
|
|
||||||
Balance as of June 30, 2011
|
|
$
|
(17,441
|
)
|
|
$
|
2,208
|
|
|
$
|
(15,233
|
)
|
Other comprehensive income (loss)
|
|
937
|
|
|
(12,365
|
)
|
|
(11,428
|
)
|
|||
Tax benefit (expense)
|
|
(398
|
)
|
|
5,254
|
|
|
4,856
|
|
|||
Balance as of December 31, 2011
|
|
$
|
(16,902
|
)
|
|
$
|
(4,903
|
)
|
|
$
|
(21,805
|
)
|
|
|
Pension Plans
|
|
Postretirement Plan
|
||||||||||||
|
|
Three Months Ended
|
|
Three Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Service cost
|
|
$
|
1,681
|
|
|
$
|
1,640
|
|
|
$
|
60
|
|
|
$
|
45
|
|
Interest cost
|
|
1,723
|
|
|
1,724
|
|
|
84
|
|
|
76
|
|
||||
Expected return on plan assets
|
|
(938
|
)
|
|
(652
|
)
|
|
—
|
|
|
—
|
|
||||
Recognized actuarial loss (gain)
|
|
540
|
|
|
511
|
|
|
6
|
|
|
(11
|
)
|
||||
Amortization of prior service cost (credit)
|
|
7
|
|
|
7
|
|
|
(42
|
)
|
|
(55
|
)
|
||||
Net periodic benefit cost
|
|
$
|
3,013
|
|
|
$
|
3,230
|
|
|
$
|
108
|
|
|
$
|
55
|
|
|
|
Pension Plans
|
|
Postretirement Plan
|
||||||||||||
|
|
Six Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Service cost
|
|
$
|
3,362
|
|
|
$
|
3,279
|
|
|
$
|
120
|
|
|
$
|
107
|
|
Interest cost
|
|
3,445
|
|
|
3,448
|
|
|
168
|
|
|
180
|
|
||||
Expected return on plan assets
|
|
(1,875
|
)
|
|
(1,303
|
)
|
|
—
|
|
|
—
|
|
||||
Recognized actuarial loss (gain)
|
|
1,081
|
|
|
1,023
|
|
|
12
|
|
|
(11
|
)
|
||||
Amortization of prior service cost (credit)
|
|
13
|
|
|
13
|
|
|
(83
|
)
|
|
(88
|
)
|
||||
Net periodic benefit cost
|
|
$
|
6,026
|
|
|
$
|
6,460
|
|
|
$
|
217
|
|
|
$
|
188
|
|
|
Number of
|
|
Weighted
Average
Exercise
Price Per
Share
|
|
Weighted
Average
Remaining
Contractual
Term (In Years)
|
|
Aggregate Intrinsic
Value
|
|||||||
|
Time
Vesting
Options
|
|
Performance
Vesting
Options (a) |
|
||||||||||
Balance, June 30, 2012
|
1,371
|
|
103
|
|
$
|
9.55
|
|
|
2.82
|
|
|
$
|
41,113
|
|
Exercised
(b)
|
(984)
|
|
(65)
|
|
$
|
8.21
|
|
|
|
|
|
|||
Balance, December 31, 2012
|
387
|
|
38
|
|
$
|
12.86
|
|
|
3.32
|
|
|
$
|
13,371
|
|
Exercisable at December 31, 2012
|
337
|
|
38
|
|
$
|
11.81
|
|
|
2.96
|
|
|
$
|
12,192
|
|
(a)
|
The Cablevision performance objective with respect to these awards has been achieved.
|
(b)
|
Stock options exercised during the six months ended December 31, 2012 include
340
Company stock options that were exercised pursuant to a cashless exercise, of which approximately
189
Company stock options were surrendered to the Company in order to meet tax withholding requirements and for the exercise price of the stock options. The Company remitted to Cablevision
$5,637
, which represents the aggregate value on the exercise date of the stock options that were surrendered to the Company to meet tax withholding requirements. This amount is reflected as a financing activity in the accompanying consolidated statement of cash flows for the
six months ended
December 31, 2012
and has been classified as additional paid-in capital.
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
156,770
|
|
|
$
|
142,408
|
|
|
$
|
316,308
|
|
|
$
|
281,038
|
|
MSG Entertainment
|
|
151,122
|
|
|
151,224
|
|
|
181,899
|
|
|
178,826
|
|
||||
MSG Sports
|
|
89,903
|
|
|
88,622
|
|
|
121,467
|
|
|
117,436
|
|
||||
All other
|
|
123
|
|
|
—
|
|
|
211
|
|
|
—
|
|
||||
Inter-segment eliminations
(a)
|
|
(10,032
|
)
|
|
(9,247
|
)
|
|
(27,833
|
)
|
|
(26,654
|
)
|
||||
|
|
$
|
387,886
|
|
|
$
|
373,007
|
|
|
$
|
592,052
|
|
|
$
|
550,646
|
|
(a)
|
Primarily represents local media rights recognized by the Company's MSG Sports segment from the licensing of team related programming to the Company's MSG Media segment which are eliminated in consolidation. Local media rights are generally recognized on a straight-line basis over the fiscal year.
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Inter-segment revenues
|
|
|
|
|
|
|
|
|
||||||||
MSG Entertainment
|
|
$
|
16
|
|
|
$
|
22
|
|
|
$
|
36
|
|
|
$
|
42
|
|
MSG Sports
|
|
10,016
|
|
|
9,225
|
|
|
27,797
|
|
|
26,612
|
|
||||
|
|
$
|
10,032
|
|
|
$
|
9,247
|
|
|
$
|
27,833
|
|
|
$
|
26,654
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
AOCF
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
95,618
|
|
|
$
|
63,555
|
|
|
$
|
172,322
|
|
|
$
|
127,371
|
|
MSG Entertainment
|
|
30,036
|
|
|
37,173
|
|
|
17,477
|
|
|
23,381
|
|
||||
MSG Sports
|
|
(14,484
|
)
|
|
(19,920
|
)
|
|
(13,023
|
)
|
|
(20,383
|
)
|
||||
All other
(a)
|
|
(2,882
|
)
|
|
(1,661
|
)
|
|
(5,179
|
)
|
|
(5,146
|
)
|
||||
|
|
$
|
108,288
|
|
|
$
|
79,147
|
|
|
$
|
171,597
|
|
|
$
|
125,223
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Depreciation and amortization (including impairments)
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
3,965
|
|
|
$
|
8,604
|
|
|
$
|
8,454
|
|
|
$
|
14,155
|
|
MSG Entertainment
|
|
2,433
|
|
|
2,558
|
|
|
4,791
|
|
|
4,908
|
|
||||
MSG Sports
|
|
2,795
|
|
|
2,731
|
|
|
5,598
|
|
|
5,467
|
|
||||
All other
(b)
|
|
12,551
|
|
|
10,201
|
|
|
22,601
|
|
|
15,928
|
|
||||
|
|
$
|
21,744
|
|
|
$
|
24,094
|
|
|
$
|
41,444
|
|
|
$
|
40,458
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Share-based compensation expense
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
1,470
|
|
|
$
|
1,823
|
|
|
$
|
2,672
|
|
|
$
|
2,924
|
|
MSG Entertainment
|
|
1,375
|
|
|
1,631
|
|
|
2,488
|
|
|
2,702
|
|
||||
MSG Sports
|
|
1,043
|
|
|
1,557
|
|
|
1,801
|
|
|
2,480
|
|
||||
All other
|
|
1,633
|
|
|
2,086
|
|
|
1,979
|
|
|
2,340
|
|
||||
|
|
$
|
5,521
|
|
|
$
|
7,097
|
|
|
$
|
8,940
|
|
|
$
|
10,446
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Operating income (loss)
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
90,183
|
|
|
$
|
53,128
|
|
|
$
|
161,196
|
|
|
$
|
110,292
|
|
MSG Entertainment
|
|
26,228
|
|
|
32,984
|
|
|
10,198
|
|
|
15,771
|
|
||||
MSG Sports
|
|
(18,322
|
)
|
|
(24,208
|
)
|
|
(20,422
|
)
|
|
(28,330
|
)
|
||||
All other
|
|
(17,066
|
)
|
|
(13,948
|
)
|
|
(29,759
|
)
|
|
(23,414
|
)
|
||||
|
|
$
|
81,023
|
|
|
$
|
47,956
|
|
|
$
|
121,213
|
|
|
$
|
74,319
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Total operating income for reportable segments
|
|
$
|
98,089
|
|
|
$
|
61,904
|
|
|
$
|
150,972
|
|
|
$
|
97,733
|
|
Other operating loss
|
|
(17,066
|
)
|
|
(13,948
|
)
|
|
(29,759
|
)
|
|
(23,414
|
)
|
||||
Operating income
|
|
81,023
|
|
|
47,956
|
|
|
121,213
|
|
|
74,319
|
|
||||
Items excluded from operating income:
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
571
|
|
|
580
|
|
|
1,152
|
|
|
1,127
|
|
||||
Interest expense
|
|
(1,855
|
)
|
|
(1,891
|
)
|
|
(3,566
|
)
|
|
(3,640
|
)
|
||||
Miscellaneous income
|
|
66
|
|
|
—
|
|
|
102
|
|
|
—
|
|
||||
Income from operations before income taxes
|
|
$
|
79,805
|
|
|
$
|
46,645
|
|
|
$
|
118,901
|
|
|
$
|
71,806
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Capital expenditures
|
|
|
|
|
|
|
|
|
||||||||
MSG Media
|
|
$
|
2,027
|
|
|
$
|
1,905
|
|
|
$
|
8,501
|
|
|
$
|
3,074
|
|
MSG Entertainment
|
|
3,058
|
|
|
1,075
|
|
|
3,741
|
|
|
1,926
|
|
||||
MSG Sports
|
|
634
|
|
|
691
|
|
|
1,317
|
|
|
954
|
|
||||
All other
(c)
|
|
83,246
|
|
|
116,777
|
|
|
145,754
|
|
|
259,917
|
|
||||
|
|
$
|
88,965
|
|
|
$
|
120,448
|
|
|
$
|
159,313
|
|
|
$
|
265,871
|
|
(a)
|
Consists of unallocated corporate general and administrative costs. The results for the three months ended December 31, 2011 reflect a benefit of approximately
$975
related to changes made by the Company to include certain non-capitalized Transformation sales-related and other expenses in its reportable segment results that were previously not allocated. The offset to this benefit is primarily reflected in the MSG Sports segment results of operations for the three months ended December 31, 2011.
|
(b)
|
Principally includes depreciation and amortization expense on The Garden and The Theater at Madison Square Garden and certain corporate property, equipment and leasehold improvement assets not allocated to the Company's reportable segments.
|
(c)
|
Consists principally of capital expenditures associated with the Transformation.
|
•
|
the level of our revenues, which depends in part on the popularity and competitiveness of our sports teams and the level and popularity of the
Radio City Christmas Spectacular
and other entertainment events which are presented in our venues;
|
•
|
costs associated with player injuries, and waivers or contract terminations of players and other team personnel;
|
•
|
changes in professional sports teams' compensation, including the impact of signing of free agents and trades, subject to league salary caps;
|
•
|
the level and timing of our capital expenditures, including the comprehensive Transformation of The Garden;
|
•
|
the impact of the comprehensive Transformation of The Garden or the renovation of the Forum on our operations, including any unexpected delays, costs or other matters associated with the Transformation or the renovation of the Forum;
|
•
|
the demand for our programming among cable television systems and satellite, telephone and other multichannel video programming distributors, and our ability to renew affiliation agreements with them;
|
•
|
general economic conditions especially in the New York City metropolitan area where we conduct the majority of our operations;
|
•
|
the demand for sponsorship arrangements and for advertising and viewer ratings for our programming;
|
•
|
competition, for example, from other regional sports networks, other teams, other venues and other entertainment options;
|
•
|
changes in laws, NBA or NHL rules, regulations, guidelines, bulletins, directives, policies and agreements (including the leagues' respective collective bargaining agreements with their players' associations, salary caps, revenue sharing and NBA luxury tax thresholds) or other regulations under which we operate;
|
•
|
any NBA or NHL work stoppage;
|
•
|
the relocation or insolvency of professional sports teams with which we have a rights agreement;
|
•
|
our ability to maintain, obtain or produce content for our MSG Media segment, together with the cost of such content;
|
•
|
future acquisitions and dispositions of assets;
|
•
|
the costs associated with, and the outcome of, litigation and other proceedings to the extent uninsured;
|
•
|
the impact of governmental regulations, including the ability to maintain necessary permits or licenses;
|
•
|
financial community and rating agency perceptions of our business, operations, financial condition and the industry in which we operate;
|
•
|
our ownership of professional sports franchises in the NBA and NHL and certain transfer restrictions on our common stock; and
|
•
|
the factors described under "Risk Factors" in the Company's Annual Report on Form 10-K for the
year ended June 30, 2012
.
|
|
|
Three Months Ended December 31,
|
|
Increase
(Decrease)
in Net
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
387,886
|
|
|
100
|
%
|
|
$
|
373,007
|
|
|
100
|
%
|
|
$
|
14,879
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Direct operating
|
|
207,177
|
|
|
53
|
%
|
|
224,914
|
|
|
60
|
%
|
|
17,737
|
|
|||
Selling, general and administrative
|
|
77,942
|
|
|
20
|
%
|
|
76,043
|
|
|
20
|
%
|
|
(1,899
|
)
|
|||
Depreciation and amortization (including
impairments)
|
|
21,744
|
|
|
6
|
%
|
|
24,094
|
|
|
6
|
%
|
|
2,350
|
|
|||
Operating income
|
|
81,023
|
|
|
21
|
%
|
|
47,956
|
|
|
13
|
%
|
|
33,067
|
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
|
(1,284
|
)
|
|
NM
|
|
|
(1,311
|
)
|
|
NM
|
|
|
27
|
|
|||
Miscellaneous
|
|
66
|
|
|
NM
|
|
|
—
|
|
|
NM
|
|
|
66
|
|
|||
Income from operations before income taxes
|
|
79,805
|
|
|
21
|
%
|
|
46,645
|
|
|
13
|
%
|
|
33,160
|
|
|||
Income tax expense
|
|
(32,894
|
)
|
|
(8
|
)%
|
|
(21,026
|
)
|
|
(6
|
)%
|
|
(11,868
|
)
|
|||
Net income
|
|
$
|
46,911
|
|
|
12
|
%
|
|
$
|
25,619
|
|
|
7
|
%
|
|
$
|
21,292
|
|
Increase in MSG Media segment revenues
|
$
|
14,362
|
|
Decrease in MSG Entertainment segment revenues
|
(102
|
)
|
|
Increase in MSG Sports segment revenues
|
1,281
|
|
|
Increase in other revenues
|
123
|
|
|
Inter-segment eliminations
|
(785
|
)
|
|
|
$
|
14,879
|
|
Decrease in MSG Media segment expenses
|
$
|
(19,750
|
)
|
Increase in MSG Entertainment segment expenses
|
6,317
|
|
|
Decrease in MSG Sports segment expenses
|
(3,488
|
)
|
|
Decrease in other expenses
|
(3
|
)
|
|
Inter-segment eliminations
|
(813
|
)
|
|
|
$
|
(17,737
|
)
|
Increase in MSG Media segment expenses
|
$
|
1,696
|
|
Increase in MSG Entertainment segment expenses
|
462
|
|
|
Decrease in MSG Sports segment expenses
|
(1,181
|
)
|
|
Increase in other expenses
|
894
|
|
|
Inter-segment eliminations
|
28
|
|
|
|
$
|
1,899
|
|
|
|
Three Months Ended
|
|
Increase (Decrease)
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating income
|
|
$
|
81,023
|
|
|
$
|
47,956
|
|
|
$
|
33,067
|
|
Share-based compensation
|
|
5,521
|
|
|
7,097
|
|
|
(1,576
|
)
|
|||
Depreciation and amortization (including impairments)
|
|
21,744
|
|
|
24,094
|
|
|
(2,350
|
)
|
|||
AOCF
|
|
$
|
108,288
|
|
|
$
|
79,147
|
|
|
$
|
29,141
|
|
Increase in AOCF of the MSG Media segment
|
$
|
32,063
|
|
Decrease in AOCF of the MSG Entertainment segment
|
(7,137
|
)
|
|
Increase in AOCF of the MSG Sports segment
|
5,436
|
|
|
Other net decreases
|
(1,221
|
)
|
|
|
$
|
29,141
|
|
|
|
Three Months Ended December 31,
|
|
Increase
(Decrease) in
Operating
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
156,770
|
|
|
100
|
%
|
|
$
|
142,408
|
|
|
100
|
%
|
|
$
|
14,362
|
|
Direct operating expenses
|
|
32,700
|
|
|
21
|
%
|
|
52,450
|
|
|
37
|
%
|
|
19,750
|
|
|||
Selling, general and administrative expenses
|
|
29,922
|
|
|
19
|
%
|
|
28,226
|
|
|
20
|
%
|
|
(1,696
|
)
|
|||
Depreciation and amortization (including
impairments)
|
|
3,965
|
|
|
3
|
%
|
|
8,604
|
|
|
6
|
%
|
|
4,639
|
|
|||
Operating income
|
|
$
|
90,183
|
|
|
58
|
%
|
|
$
|
53,128
|
|
|
37
|
%
|
|
$
|
37,055
|
|
|
|
Three Months Ended
|
|
Increase
(Decrease)
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating income
|
|
$
|
90,183
|
|
|
$
|
53,128
|
|
|
$
|
37,055
|
|
Share-based compensation
|
|
1,470
|
|
|
1,823
|
|
|
(353
|
)
|
|||
Depreciation and amortization (including impairments)
|
|
3,965
|
|
|
8,604
|
|
|
(4,639
|
)
|
|||
AOCF
|
|
$
|
95,618
|
|
|
$
|
63,555
|
|
|
$
|
32,063
|
|
Increase in affiliation fee revenue
|
$
|
5,170
|
|
Increase in advertising revenue
|
5,109
|
|
|
Other net increases
|
4,083
|
|
|
|
$
|
14,362
|
|
Decrease in programming acquisition costs (rights fees)
|
$
|
(16,186
|
)
|
Decrease in non-rights related programming costs
|
(3,564
|
)
|
|
|
$
|
(19,750
|
)
|
|
|
Three Months Ended December 31,
|
|
Increase
(Decrease) in
Operating
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
151,122
|
|
|
100
|
%
|
|
$
|
151,224
|
|
|
100
|
%
|
|
$
|
(102
|
)
|
Direct operating expenses
|
|
105,616
|
|
|
70
|
%
|
|
99,299
|
|
|
66
|
%
|
|
(6,317
|
)
|
|||
Selling, general and administrative expenses
|
|
16,845
|
|
|
11
|
%
|
|
16,383
|
|
|
11
|
%
|
|
(462
|
)
|
|||
Depreciation and amortization
|
|
2,433
|
|
|
2
|
%
|
|
2,558
|
|
|
2
|
%
|
|
125
|
|
|||
Operating income
|
|
$
|
26,228
|
|
|
17
|
%
|
|
$
|
32,984
|
|
|
22
|
%
|
|
$
|
(6,756
|
)
|
|
|
Three Months Ended
|
|
Decrease
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating income
|
|
$
|
26,228
|
|
|
$
|
32,984
|
|
|
$
|
(6,756
|
)
|
Share-based compensation
|
|
1,375
|
|
|
1,631
|
|
|
(256
|
)
|
|||
Depreciation and amortization
|
|
2,433
|
|
|
2,558
|
|
|
(125
|
)
|
|||
AOCF
|
|
$
|
30,036
|
|
|
$
|
37,173
|
|
|
$
|
(7,137
|
)
|
Decrease in revenues from the presentation of the
Radio City Christmas Spectacular
franchise
|
$
|
(3,207
|
)
|
Decrease in event-related revenues at the Beacon Theatre
|
(2,414
|
)
|
|
Increase in event-related revenues at The Theater at Madison Square Garden
|
4,853
|
|
|
Other net increases
|
666
|
|
|
|
$
|
(102
|
)
|
Increase in event-related direct operating expenses at The Theater at Madison Square Garden
|
$
|
3,425
|
|
Increase in direct operating expenses related to the presentation of the
Radio City Christmas Spectacular
franchise
|
2,679
|
|
|
Decrease in event-related direct operating expenses at the Beacon Theatre
|
(876
|
)
|
|
Other net increases
|
1,089
|
|
|
|
$
|
6,317
|
|
|
|
Three Months Ended
|
|
Increase (Decrease)
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating loss
|
|
$
|
(18,322
|
)
|
|
$
|
(24,208
|
)
|
|
$
|
5,886
|
|
Share-based compensation
|
|
1,043
|
|
|
1,557
|
|
|
(514
|
)
|
|||
Depreciation and amortization
|
|
2,795
|
|
|
2,731
|
|
|
64
|
|
|||
AOCF
|
|
$
|
(14,484
|
)
|
|
$
|
(19,920
|
)
|
|
$
|
5,436
|
|
Increase in revenues from NHL and NBA distributions
|
$
|
6,093
|
|
Increase in broadcast rights fees from MSG Media
|
812
|
|
|
Decrease in professional sports teams' pre/regular season ticket-related revenue
|
(507
|
)
|
|
Decrease in suite rental fee revenue
|
(970
|
)
|
|
Decrease in professional sports teams' food, beverage and merchandise sales
|
(1,062
|
)
|
|
Decrease in event-related revenues from other live sporting events
|
(3,333
|
)
|
|
Other net increases
|
248
|
|
|
|
$
|
1,281
|
|
Decrease in net provisions for certain team personnel transactions (including the impact of NBA luxury tax)
|
$
|
(7,634
|
)
|
Decrease in event-related expenses associated with other live sporting events
|
(2,150
|
)
|
|
Decrease in team personnel compensation
|
(1,330
|
)
|
|
Increase in net provisions for NBA luxury tax and NBA and NHL revenue sharing expense
|
3,267
|
|
|
Increase in other team operating expenses
|
4,135
|
|
|
Other net increases
|
224
|
|
|
|
$
|
(3,488
|
)
|
|
|
Three Months Ended
|
||||||||||
|
|
December 31,
|
||||||||||
|
|
2012
|
|
2011
|
|
Increase (Decrease)
|
||||||
Net provisions for certain team personnel transactions (including the impact
of NBA luxury tax) |
|
$
|
2,261
|
|
|
$
|
9,895
|
|
|
$
|
(7,634
|
)
|
Net provisions for NBA luxury tax and NBA and NHL revenue sharing
expense
|
|
5,669
|
|
|
2,402
|
|
|
3,267
|
|
|
|
Six Months Ended December 31,
|
|
Increase
(Decrease)
in Net
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
592,052
|
|
|
100
|
%
|
|
$
|
550,646
|
|
|
100
|
%
|
|
$
|
41,406
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Direct operating
|
|
279,918
|
|
|
47
|
%
|
|
296,398
|
|
|
54
|
%
|
|
16,480
|
|
|||
Selling, general and administrative
|
|
149,477
|
|
|
25
|
%
|
|
139,471
|
|
|
25
|
%
|
|
(10,006
|
)
|
|||
Depreciation and amortization (including
impairments)
|
|
41,444
|
|
|
7
|
%
|
|
40,458
|
|
|
7
|
%
|
|
(986
|
)
|
|||
Operating income
|
|
121,213
|
|
|
20
|
%
|
|
74,319
|
|
|
13
|
%
|
|
46,894
|
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
|
(2,414
|
)
|
|
NM
|
|
|
(2,513
|
)
|
|
NM
|
|
|
99
|
|
|||
Miscellaneous
|
|
102
|
|
|
NM
|
|
|
—
|
|
|
NM
|
|
|
102
|
|
|||
Income from operations before income taxes
|
|
118,901
|
|
|
20
|
%
|
|
71,806
|
|
|
13
|
%
|
|
47,095
|
|
|||
Income tax expense
|
|
(51,385
|
)
|
|
(9
|
)%
|
|
(24,899
|
)
|
|
(5
|
)%
|
|
(26,486
|
)
|
|||
Net income
|
|
$
|
67,516
|
|
|
11
|
%
|
|
$
|
46,907
|
|
|
9
|
%
|
|
$
|
20,609
|
|
Increase in MSG Media segment revenues
|
$
|
35,270
|
|
Increase in MSG Entertainment segment revenues
|
3,073
|
|
|
Increase in MSG Sports segment revenues
|
4,031
|
|
|
Increase in other revenues
|
211
|
|
|
Inter-segment eliminations
|
(1,179
|
)
|
|
|
$
|
41,406
|
|
Decrease in MSG Media segment expenses
|
$
|
(14,773
|
)
|
Increase in MSG Entertainment segment expenses
|
6,968
|
|
|
Decrease in MSG Sports segment expenses
|
(7,469
|
)
|
|
Decrease in other expenses
|
(2
|
)
|
|
Inter-segment eliminations
|
(1,204
|
)
|
|
|
$
|
(16,480
|
)
|
Increase in MSG Media segment expenses
|
$
|
4,840
|
|
Increase in MSG Entertainment segment expenses
|
1,795
|
|
|
Increase in MSG Sports segment expenses
|
3,461
|
|
|
Decrease in other expenses
|
(115
|
)
|
|
Inter-segment eliminations
|
25
|
|
|
|
$
|
10,006
|
|
|
Six Months Ended
|
|
Increase
(Decrease) in
AOCF
|
||||||||
|
December 31,
|
|
|||||||||
|
2012
|
|
2011
|
|
|||||||
Operating income
|
$
|
121,213
|
|
|
$
|
74,319
|
|
|
$
|
46,894
|
|
Share-based compensation
|
8,940
|
|
|
10,446
|
|
|
(1,506
|
)
|
|||
Depreciation and amortization (including impairments)
|
41,444
|
|
|
40,458
|
|
|
986
|
|
|||
AOCF
|
$
|
171,597
|
|
|
$
|
125,223
|
|
|
$
|
46,374
|
|
Increase in AOCF of the MSG Media segment
|
$
|
44,951
|
|
Decrease in AOCF of the MSG Entertainment segment
|
(5,904
|
)
|
|
Increase in AOCF of the MSG Sports segment
|
7,360
|
|
|
Other net decreases
|
(33
|
)
|
|
|
$
|
46,374
|
|
|
|
Six Months Ended December 31,
|
|
Increase
(Decrease) in
Operating
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
316,308
|
|
|
100
|
%
|
|
$
|
281,038
|
|
|
100
|
%
|
|
$
|
35,270
|
|
Direct operating expenses
|
|
90,329
|
|
|
29
|
%
|
|
105,102
|
|
|
37
|
%
|
|
14,773
|
|
|||
Selling, general and administrative expenses
|
|
56,329
|
|
|
18
|
%
|
|
51,489
|
|
|
18
|
%
|
|
(4,840
|
)
|
|||
Depreciation and amortization (including
impairments)
|
|
8,454
|
|
|
3
|
%
|
|
14,155
|
|
|
5
|
%
|
|
5,701
|
|
|||
Operating income
|
|
$
|
161,196
|
|
|
51
|
%
|
|
$
|
110,292
|
|
|
39
|
%
|
|
$
|
50,904
|
|
|
|
Six Months Ended
|
|
Increase
(Decrease)
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating income
|
|
$
|
161,196
|
|
|
$
|
110,292
|
|
|
$
|
50,904
|
|
Share-based compensation
|
|
2,672
|
|
|
2,924
|
|
|
(252
|
)
|
|||
Depreciation and amortization (including impairments)
|
|
8,454
|
|
|
14,155
|
|
|
(5,701
|
)
|
|||
AOCF
|
|
$
|
172,322
|
|
|
$
|
127,371
|
|
|
$
|
44,951
|
|
Increase in affiliation fee revenue
|
$
|
22,128
|
|
Increase in advertising revenue
|
4,820
|
|
|
Other net increases
|
8,322
|
|
|
|
$
|
35,270
|
|
Decrease in programming acquisition costs (rights fees)
|
$
|
(16,461
|
)
|
Increase in non-rights related programming costs
|
1,688
|
|
|
|
$
|
(14,773
|
)
|
|
|
Six Months Ended December 31,
|
|
Increase
(Decrease) in
Operating
Income
|
||||||||||||||
|
|
2012
|
|
2011
|
|
|||||||||||||
|
|
Amount
|
|
% of
Revenues
|
|
Amount
|
|
% of
Revenues
|
|
|||||||||
Revenues
|
|
$
|
181,899
|
|
|
100
|
%
|
|
$
|
178,826
|
|
|
100
|
%
|
|
$
|
3,073
|
|
Direct operating expenses
|
|
133,974
|
|
|
74
|
%
|
|
127,006
|
|
|
71
|
%
|
|
(6,968
|
)
|
|||
Selling, general and administrative expenses
|
|
32,936
|
|
|
18
|
%
|
|
31,141
|
|
|
17
|
%
|
|
(1,795
|
)
|
|||
Depreciation and amortization
|
|
4,791
|
|
|
3
|
%
|
|
4,908
|
|
|
3
|
%
|
|
117
|
|
|||
Operating income
|
|
$
|
10,198
|
|
|
6
|
%
|
|
$
|
15,771
|
|
|
9
|
%
|
|
$
|
(5,573
|
)
|
|
|
Six Months Ended
|
|
Decrease
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating income
|
|
$
|
10,198
|
|
|
$
|
15,771
|
|
|
$
|
(5,573
|
)
|
Share-based compensation
|
|
2,488
|
|
|
2,702
|
|
|
(214
|
)
|
|||
Depreciation and amortization
|
|
4,791
|
|
|
4,908
|
|
|
(117
|
)
|
|||
AOCF
|
|
$
|
17,477
|
|
|
$
|
23,381
|
|
|
$
|
(5,904
|
)
|
Increase in event-related revenues at The Theater at Madison Square Garden
|
$
|
4,958
|
|
Increase in venue related sponsorship and signage and suite rental fee revenues
|
2,228
|
|
|
Decrease in event-related revenues at Radio City Music Hall, excluding
Radio City Christmas Spectacular
|
(1,260
|
)
|
|
Decrease in event-related revenues at the Beacon Theatre
|
(1,458
|
)
|
|
Decrease in revenues from the presentation of the
Radio City Christmas Spectacular
franchise
|
(3,017
|
)
|
|
Other net increases
|
1,622
|
|
|
|
$
|
3,073
|
|
Increase in event-related direct operating expenses at The Theater at Madison Square Garden
|
$
|
3,439
|
|
Increase in direct operating expenses related to the presentation of the
Radio City Christmas Spectacular
franchise
|
2,437
|
|
|
Decrease in event-related direct operating expenses at Radio City Music Hall, excluding
Radio City Christmas
Spectacular
|
(1,631
|
)
|
|
Decrease in event-related direct operating expenses at the Beacon Theatre
|
(498
|
)
|
|
Other net increases
|
3,221
|
|
|
|
$
|
6,968
|
|
|
|
Six Months Ended
|
|
Increase (Decrease)
in AOCF
|
||||||||
|
|
December 31,
|
|
|||||||||
|
|
2012
|
|
2011
|
|
|||||||
Operating loss
|
|
$
|
(20,422
|
)
|
|
$
|
(28,330
|
)
|
|
$
|
7,908
|
|
Share-based compensation
|
|
1,801
|
|
|
2,480
|
|
|
(679
|
)
|
|||
Depreciation and amortization
|
|
5,598
|
|
|
5,467
|
|
|
131
|
|
|||
AOCF
|
|
$
|
(13,023
|
)
|
|
$
|
(20,383
|
)
|
|
$
|
7,360
|
|
Increase in revenues from NHL and NBA distributions
|
$
|
6,028
|
|
Increase in suite rental fee revenue
|
1,336
|
|
|
Increase in broadcast rights fees from MSG Media
|
1,204
|
|
|
Increase in professional sports teams' sponsorship and signage revenues
|
1,046
|
|
|
Decrease in professional sports teams' pre/regular season ticket-related revenue
|
(833
|
)
|
|
Decrease in professional sports teams' food, beverage and merchandise sales
|
(1,189
|
)
|
|
Decrease in event-related revenues from other live sporting events
|
(3,515
|
)
|
|
Other net decreases
|
(46
|
)
|
|
|
$
|
4,031
|
|
Decrease in net provisions for certain team personnel transactions (including the impact of NBA luxury tax)
|
$
|
(7,039
|
)
|
Decrease in event-related expenses associated with other live sporting events
|
(2,300
|
)
|
|
Decrease in team personnel compensation
|
(1,695
|
)
|
|
Increase in net provisions for NBA luxury tax and NBA and NHL revenue sharing expense (excluding playoffs)
|
3,326
|
|
|
Increase in other team operating expenses
|
48
|
|
|
Other net increases
|
191
|
|
|
|
$
|
(7,469
|
)
|
|
|
Six Months Ended
|
||||||||||
|
|
December 31,
|
||||||||||
|
|
2012
|
|
2011
|
|
Increase (Decrease)
|
||||||
Net provisions for certain team personnel transactions (including the impact
of NBA luxury tax) |
|
$
|
2,856
|
|
|
$
|
9,895
|
|
|
$
|
(7,039
|
)
|
Net provisions for NBA luxury tax and NBA and NHL revenue sharing
expense (excluding playoffs) |
|
5,728
|
|
|
2,402
|
|
|
3,326
|
|
MSG Media
|
$
|
465,326
|
|
MSG Entertainment
|
58,979
|
|
|
MSG Sports
|
218,187
|
|
|
|
$
|
742,492
|
|
Sports franchises (MSG Sports segment)
|
$
|
96,215
|
|
Trademarks (MSG Entertainment segment)
|
62,421
|
|
|
|
$
|
158,636
|
|
(a)
|
Index to Exhibits
|
|
|
|
EXHIBIT
NO.
|
|
DESCRIPTION
|
10.1
|
|
Amendment No. 2 to the Credit Agreement dated as of December 7, 2012 among MSG Holdings, L.P., the Guarantors (as defined in the Credit Agreement), the banks, financial institutions and other institutional lenders parties to the Credit Agreement and JPMorgan Chase Bank, National Association, as agent for the Lenders.
|
|
|
|
10.2
|
|
Form of Non-Employee Director Award Agreement. †
|
|
|
|
31.1
|
|
Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
31.2
|
|
Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.1
|
|
Certification by the Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.2
|
|
Certification by the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema.
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase.
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase.
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase.
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase.
|
†
|
This exhibit is a management contract or a compensatory plan or arrangement.
|
The Madison Square Garden Company
|
||
|
|
|
By:
|
/
S
/ R
OBERT
M. P
OLLICHINO
|
|
|
Name:
|
Robert M. Pollichino
|
|
Title:
|
Executive Vice President and Chief
|
|
|
Financial Officer
|
THE MADISON SQUARE GARDEN COMPANY
|
By:______________________________________
|
Name:
Title:
|
|
By:______________________________________
|
Name:
Title:
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of The Madison Square Garden Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Hank J. Ratner
|
Hank J. Ratner
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of The Madison Square Garden Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Robert M. Pollichino
|
Robert M. Pollichino
|
Executive Vice President and Chief Financial Officer
|
/s/ Hank J. Ratner
|
Hank J. Ratner
|
President and Chief Executive Officer
|
/s/ Robert M. Pollichino
|
Robert M. Pollichino
|
Executive Vice President and Chief Financial Officer
|