WWE Third Quarter Results: Revenues Down From 2011, Vince McMahon Comments

Live and Televised Entertainment

Revenues from our Live and Televised Entertainment businesses increased 1% to $79.0 million reflecting increased merchandise sales at our live events and incremental Pay-Per-View revenue from the strong performance of our SummerSlam event.

* Live Event revenues were $22.8 million as compared to $23.0 million in the prior year quarter as increases in average attendance and ticket prices at our events in domestic and international markets were offset by a reduction in the number and mix of international events.

- There were 77 total events, including 70 events in North America and 7 events in international markets, in the current quarter as compared to 79 events, including 64 events in North America and 15 events in international markets in the prior year quarter.

- North American events generated revenues of $17.0 million as compared to $14.2 million in the prior year quarter, with growth of $2.8 million reflecting increases in the number of events, average attendance and average realized ticket price. There were 6 additional events in the period, representing a 9% increase from the prior year quarter. Average attendance increased 6% to approximately 5,200 from 4,900 in the prior year quarter. In addition, the average ticket price for these events increased 3% to $42.73 from $41.34 in the prior year quarter.

- International events generated revenues of $5.8 million as compared to $8.8 million in the prior year quarter as the impact of fewer events in the period more than offset increases in average attendance and in the average realized ticket price. There were 8 fewer events in the period, representing a 53% decline from the prior year quarter. Average attendance increased 17% to approximately 8,400 from 7,200 in the prior year quarter. In addition, the average ticket price for these events increased 23% to $98.23 from $80.08 in the prior year quarter. The increases in both average attendance and average ticket price reflected, in part, changes in territory mix as events in the current year quarter were concentrated in cities with greater economic strength than in the prior year quarter.

* Pay-Per-View revenues were $16.3 million as compared to $15.8 million in the prior year quarter. Revenue increased 3% as a 13% increase in buys for our third quarter events was partially offset by the timing of buys for prior period events. The growth in buys for our current quarter events was predominantly due to our SummerSlam pay-per-view. Buys for that event increased 21% from the prior year quarter, demonstrating its creative strength and audience appeal. Offsetting this performance, buys for WrestleMania, a prior period event, declined 63,000 primarily due to timing. On a year-to-date basis, buys for this premiere event remained 8% above the prior year period.

* Television revenues were $34.0 million in both the current and prior year quarter. Incremental license fees from the production and distribution of new programs and contractual increases for our existing programs were offset by the timing and number of domestic SmackDown and international telecast weeks within our fiscal quarter (i.e., 13 telecast weeks compared to 14 in the prior year quarter), and by a reduction in sponsorship revenue related to our television assets. An additional hour of our weekly Raw program was licensed to USA Network and debuted on July 23, 2012.

* Venue Merchandise revenues were $4.5 million as compared to $3.6 million in the prior year quarter. The 25% increase was primarily due to a 26% increase in total domestic (U.S.) attendance. Domestic per capita merchandise sales increased 1% to $10.28 in the current year quarter.

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