Mexico city.- As a measure to deal with the crisis in the entertainment industry due to the COVID-19, Live Nation -one of the most important in the production of concerts announced some initiatives to reduce costs.
According to information of the magazine Pollstarexecutives of Live Nation have cut or deferred their salaries to counteract the pandemic, and about eight thousand performances that have been affected, which means 15 million tickets sold and 90 per cent of entries postponed.
The president of the company, Michael Rapino, unveiled the program of cost reduction and cash management of the company as a measure to increase the liquidity of the company.
“The entertainment industry in vivo has generated a global growth amazing for more than 20 years, which speaks of the passion and strength of the demand of the fans. With this additional liquidity, the flexibility in our covenants of debt and cost cutting efforts, we believe that Live Nation has the financial strength to withstand this difficult time.
We will be ready to quickly increase and reconnect the public with the artists at the concerts who wait”.
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In addition to the salary cuts for executives, the measures include freezing recruitment, reduction in the use of contractors, renegotiations of leases, licenses and reduction or elimination of other discretionary spending such as travel, repairs and maintenance, or marketing.
On the other hand, accept the government aid in Europe, Asia, Australia and the united States.
It also announced that it expects that, with a cut in the first quarter of 2020, their income fall by 20 per cent.
While in the united States -which brings together half of affectations – already started the refunds, will have to wait to meet the new dates of the concerts to do so in other countries.
“While the balances of deferred revenue related to events fluctuate throughout the year, since the time of the shows in 2020 and the substantial volume of sales to 2021 in the second half of this year, the company expects this number to stay above levels normal seasonal along this year”,
So said the executive in a press release disseminated through a variety of international media.
The balance of cash and cash equivalents is $ 3.3 billion, including 914 million of free cash and two billion dollars of deferred revenue related events.
According to the site, Pollstar, the market cap of Live Nation spent around 15 billion to eight billion dollars.