Earnings before interest, taxes, depreciation and amortization (EBITDA) margins are now about 7%. How can they drive that number higher?
- Ticket price increases of 2 - 8% generate margin improvement of between -0.8% and +1.3%
- Ticket price increases of 10% leas to margin improvement of more than 2%
- 15% ticket price increases bring profit margins of 3.6%
The bottom line is that if the merger fails to create incremental returns for Live Nation Entertainment, consumers win but shareholders lose. If the merger does generate enough incremental returns, on the other hand, shareholders win and consumers lose. I'm putting my money behind the shareholders."