Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Liberty Media Corporation 2018 Second Quarter Earnings Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded, August, 8.

I would now like to turn the conference over to Courtnee Chun, Senior Vice President of Investor Relations. Please go ahead..

Thank you.

Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, market potential, new service and product launches, discussions involving iHeart communications, plans for the Battery Atlanta, matters related to Formula One, including digital initiative, new races, new car structures, potential governance changes, sponsorship opportunities and distribution renewals, and other matter that are not historical facts.

These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including without limitation, possible changes in market acceptance of new products or services, the ability of our businesses to attract and retain customers, competitive issues, regulatory issues, and the availability of capital on terms acceptable to Liberty Media.

These forward-looking statements speak only as of the date of this call and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty Media's expectations with regard thereto, or any change in events, conditions or circumstances on which any such statement is based.

On today's call, we will discuss certain non-GAAP financial measures including adjusted OIBDA of Liberty Media and adjusted EBITDA of Sirius XM. The required definitions and reconciliations schedules 1 through 3 can be found at the end of the earnings press release issued today, which is available on our Web site.

This call also may include certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Liberty TripAdvisor Holdings. These forward-looking statements involve any risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements.

These forward-looking statements speak only as of date of this call, and Liberty TripAdvisor Holdings expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty TripAdvisor Holdings expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

Now, I'd like to turn the call over to Greg Maffei, Liberty's President and CEO..

Thank you, Courtnee. Good morning or good afternoon to some of you on the East Coast. Today speaking on the call, besides myself, we will have Liberty's CFO, Mark Carleton; and Formula One's Chairman and CEO, Chase Carey. During the Q&A, we'll also be available to answer questions related to Liberty TripAdvisor.

So starting with Liberty Sirius XM, we did continue our repurchases of the stock and bought an additional 161 million for a total purchase of $261 million through July 31. We effectively bought those Sirius XM shares at a 4.69 look-through price over the period to year-to-date.

Regarding iHeart Communications, some of you may have noted, we pulled our initial offer after reviewing the results in the projected balance sheet, which were below expectations, and negatively impacted our estimates of value. We do continue to own $660 million in aggregate principle amount of iHeart bonds.

Looking at Sirius XM itself, it had outstanding second quarter results. Revenue was up 6% to $1.4 billion. I think there's lots of good news in the quarter. Two standouts, self-pay net ads [ph] of $483,000, and churn down to 1.6%. Liberty Media ownership, as of July 23rd, stood at 70.5%.

Turning to Formula One Group, a great 2018 season with more exciting outcomes, varied podium finishers, increased overtaking, more drama, and still the same glamour. In sponsorship, we signed a new technology provider and global sponsor in Amazon Web Services, renewed key global sponsorships in multiyear agreements.

We also extended the Belgian Grand Prix, at Spa. I would take a word of caution as some of our more perspicacious analysts have noted, quarterly results will vary due to rev wreck, timing of races, number of races, and the nature of the business. We remain very positive about the long-term direction, and that we're headed in the right path.

Live Nation had another fantastic quarter, revenues up 7% for the quarter. All divisions continue to deliver double-digit operating income and AOI growth, particularly a strong year for amphitheaters, on track to grow by three million fans for the full-year. Turning to Braves, in second place in [indiscernible] after an exciting victory last night.

In our second year at SunTrust Park, ticket sales have increased over 2% versus our inaugural season, which is really unusual, including 13 sell-outs and a new record attendance for SunTrust Park. There are several exciting developments at the real estate development at Battery.

ThyssenKrupp, a multinational powerhouse with over $41 billion in revenue, will build its elevator business' North American headquarters and innovation center complex at the Battery. This will bring 900 jobs to three facilities on a nearly five acre site.

We are progressing with the sale of our residential development, and have identified the potential buyer. We'll provide more details once that transaction closes, but we forecast an expected IRR on that transaction of 22%.

Based on current sales, we are projecting that Battery will have three of the top ten grossing restaurants in the Atlanta Area by year-end. We also announced the planned development of an Aloft Hotel this morning. Final announcement -- that final announcement completes our development plan at the Battery.

Over at Liberty TripAdvisor, I'm looking at the underlying results for Trip. Trip had a fantastic quarter, full stop; the third straight quarter of hotel-adjusted EBITDA improvement even with significant marketing reductions. In my view, the initial market reaction on these quarterly results was just wrong.

Seems the stock has been coming around, but I still think they're missing the larger story. Trip is executing very well. It's optimizing it's SEO marketing mix in hotels. It has improved its product offering. It is growing its advertising and sponsored listing, which is a highly profitable incremental business.

And it's increasing its bookable supply for non-hotel offerings, and is a leader in that space. Consolidated revenue was up 2%, adjusted EBITDA was up 8%, and net income was up 19%. Mobile accounted for nearly 50% of hotel shoppers, and mobile revenue per hotel shopper again grew double digits and reached a new all-time high.

With these solid results, we now expect to deliver year-over-year consolidated adjusted EBITDA growth in both operating segments in 2018. Notably, user reviews and opinions also grew significantly, up 24% year-over-year, and have reached a staggering $661 million as of June 30th.

Fun fact of the day to amuse your friends, the single most reviewed item, with over 138,000 reviews is the Sagrada Família, in Barcelona. Be sure to check out my review, it's number 114,782. With that, I'll turn over to Mark for some financial results..

Thank you, Greg, and for your review as well. At the quarter end Liberty Sirius XM Group has attributed cash and liquid investments of $110 million excluding $64 million of cash held at Sirius XM. The value of the Sirius XM common stock held at Liberty Sirius XM, as of August 7, was $22 billion, and we have $850 million in debt against these holdings.

We paid down $300 million in margin loans during the quarter. Formula One Group has attributed cash and liquid investments of $109 million, excluding $89 million of cash at Formula One [indiscernible].

Formula One Group has attributed public market securities with a market value of approximately $4 billion, as of August 7, including the intergroup interest in the Braves Group, and our stake in Live Nation. We have $2.1 billion of attribute debt excluding the debt at F1.

Debt decreased $354 million during the quarter as we paid an extraordinary additional distribution of $229 million on the exchangeable bonds due to AT&T's purchase of Time Warner, and Formula One repaid $125 million of their operating debt. Braves Group had attributed cash and liquid investments of $113 million.

At quarter end, Liberty Sirius XM Group had an attributed principle amount of debt of $7.4 billion, which includes $6.5 billion of debt at Sirius XM. Formula One Group had an attributed principle amount of debt of $5 billion, which includes $3 billion of debt at F1, and Braves Group had an attributed principle amount of debt of $629 million.

F1's total net debt to covenant OIBDA ratio as defined in their credit facilities was approximately 7.3 times as of June 30, as compared to a maximum allowable leverage ratio of 8.75 times.

We communicated a target total net leverage ratio for Formula One of five to six times bank covenant OIBDA, and please note that these leverage ratios are for the Formula One business specifically, and not the Formula One Group overall. And with that, I'll turn it over to Chase Carey to talk about Formula One..

Thank you, Mark. We are just past the halfway point of our 2018 season as we head in to [technical difficulty] I guess I was saying, we're heading into our summer break, a little over halfway into the season with our last race, the Hungarian Grand Prix being the 12th race in our 21-race season.

It's been a successful season on the track, as Greg said, with competition at the top among both drivers and teams, as well as the number of exciting and dramatic races. We're also encouraged by the momentum in fan engagement as we begin to turn around the declining trends in the sport during the past five to six years.

44% of our avid fans are more interested in the 2018 seasons than they were in 2017, versus only 7% a year ago. 66% of fans believe F1 has improved versus two years ago, while just 15% say it's worse. And 67% of fans say F1 is in good hands with Liberty, while 10% disagree.

Live attendance in aggregate is up 4% year-on-year at the 10 tracks where we raced last year. And attendance at the two tracks we did not have in 2017, which were France and Germany, was well in excess of expectations. In Germany, the promoter even had to build new grandstands to meet demand.

As importantly, fan reaction to our enhancements like fan zones, merchandizing, track tours, Hot Laps, Paddock and Paddock Club changes and more has been great. We're also encouraged by our momentum in television viewing. Race day viewership year-on-year is down 4%, however that is largely due to our move from free to paid television in Italy.

Excluding Italy, our television viewership is up 3% year-on-year, and our Saturday viewership for qualifying is up even more. We're especially pleased with our performance in our two key growth markets, the U.S. and China, where viewing figures are showing particularly strong uplifts.

Fans have reacted positively to our enhancements in cameras, sound, graphics, and other elements in our broadcasts, and we have more to come. 69% of our fans say F1 TV coverage has improved, while just 13% say it's worse. And our digital engagement continues to be an area of dynamic growth.

Year-to-date, our interactions during race week are up 60%, and our video views are up a 110%. And we are still in the early stages of upgrading and expanding our digital platform. We continue to move forward with an array of initiatives on the motor sport side of our business to improve competition, action and unpredictability.

We have introduced recent regulation changes for next season. And we will introduce a large list of sporting regulation changes in the coming weeks to further improve the sport.

Most importantly, we continue to move forward with the broader set of changes to cost structures, revenue distribution, regulations and governance the so-called concrete agreement.

We have made good progress with teams and agree on the goals and objectives and now need to work through the details to find the right compromises as we finalize these agreements in the coming months for the 2021 season.

On the commercial side of our business, we will finalize our 2019 calendar, which we expect to look a lot like our 2018 calendar, in the next few weeks as we successfully finish off renewal agreements. We are already turning our energies to the 2020 calendar.

And we are particularly excited about a number of opportunities to add new events to the 2020 calendar that we believe would really capture fans imagination and be widely supported. In fact, we are actively discussing opportunities on four continents. A potential race in Miami is one of those.

We initially targeted the Miami race for late 2019 which we knew was tight particularly for a street race where we have to navigate many local issues. It is much more important to make the race great and to push it a year earlier. So we decided a prudent choice with the focus on 2020. The support enthusiasm in Miami is great.

And we look forward to a special event there. On the television side of our business, we are also successfully completely our renewals of next year in a number of midsized and important territories at race that meet or exceed our targets. These agreements include both free and paid platforms.

And we are now also addressing digital opportunities with a number of our traditional broadcast partners. For example, opportunities for television partners to distribute over-the-top package. It is still early days for our OTT product which we launched on web platforms in May. And intend to launch on mobile and other devices in the coming months.

Our goal for this season is to improve the technology and content of the platform to enable a full commercial launch next season. We will continue to improve the OTT product the next few seasons with expanded video, data, archival and other content.

While it is still early, we are encouraged by initial anecdotal fan reaction and excited about the future about this important part of our long-term strategy. Third major pillar on our commercial area is sponsorships. And with our new team in place almost a year we are building a great momentum here.

Challenge one was to renew and expand relationships with existing sponsors and we have done that successfully. However, the key to success is to bring in new sponsors in the medium type categories for us and to create a wider deeper relationship with them.

Sponsors today are looking for more bespoke plans and want to achieve a real connection with our fans in sports not just goal board. They are creating a capability to offer this tailored relationship with expanded capabilities like fan festivals, sports, digital offerings, regionalized capabilities, and unique integrations with the sport.

We are excited about the interest from potential sponsors based in new categories and from new regions around the world. Potential sponsors are excited by our story and we are ready to take in the sport. Our recent agreement with Amazon web services was an important deal in tech space through which we will build further tech relationships.

KWS agreement is an example of our ability to establish a relationship with Amazon as both the marketing partner and as a partner bringing us world class services in the critical digital space. KWS provides a significant revenues and first class services for our growth.

Overall, no group in F1 is busier than our sponsorship group, and we believe they are on track to achieve our 2020 goals. There is a long list of other active initiatives to expand and grow the Formula One franchise from fantasy gaming to Twitter live shows, hospitality to our recently announced MIT business conferences.

2017 and 2018 have largely been investment years where we are building the foundation for the future by improving the sport and the track and for the teams in the sport, re-engaging fans at both live events and on traditional and digital platforms, building an organization that can tell our story and deliver the right opportunities to commercial partners across the board and to develop the geographic and brand extensions for Formula One.

We believe we are on track to do so. Now I will turn the call back to Greg.

Greg?.

Well, let me thank Chase and Mark and remind you all that we have -- again, some of you may already know, we'll be holding our annual investment meeting on November 14th in New York as we get close to that day, please refer to our website for additional information. As always, we appreciate your continued interest in Liberty Media.

And with that, Operator, I'd like to open the line for calls..

Thank you. [Operator Instructions] And we'll go first to Jeff Wlodarczak with Pivotal Research Group..

Good morning. I had two on F1. On your second quarter F1 results your relatively high fee Russian race last year was in April and this year it was pushed into September. So you effectively replaced that race for comp purposes in the second quarter with a French race, which I assume is a far lower fee.

How much of your 2Q revenue and EBITDA results was simply that specific sort of time and comp issue? And I assume that's going to reverse in the third quarter and then I had a follow-up..

Yes, I guess, and we don't get into specific race fees, but in general flyway races are higher than the European races. And I'd say the biggest variant in the quarter is the race calendar. I guess, the other factor in the quarter is because we amortized across last year.

I think we had eight races in both years through June and last year date of 20 and this year date of 21. So I think the calendar factors are the primary issue..

Thank you.

And then Chase if you could talk about your level of optimism about getting a new Concord agreement at least as it relates to getting a deal for the engine in place relatively soon?.

Actually, I feel good about the discussions. The devil is always in the details and I reckon that we had details to work through. But I think that people agree with the goals, people agree with the direction and they think that the overall points of what we're trying to achieve and the vision for the sport.

So I think we -- I don't think -- but we need to find the right compromises so you can get into the details. Nobody is going to get everything they want, but I think everybody recognizes that. So you're not done till you're done, but it feels good about the discussions and good about where we're going and good about the engagement with the teams..

Thank you..

Jeff, if I can add something on, I think, Chase and his team, Sean and Ross have done a great job of turning the dynamic at Formula One, which was usually fairly short-term and often fairly what's in it for me in the short-term into a more general recognition to build the health of the sport for the benefit of all.

And I think that is going to play through on the Concord agreement where the spirit of compromise is likely to occur and lead to the benefit of all under this sport and first of all and foremost of fans, so….

Thanks, Greg..

We'll go next to Vijay Jayant with Evercore ISI..

Hi, it's James Ratcliffe for Vijay. Two, if I could, one on Liberty Sirius and one on Formula One.

Liberty Sirius, what's the thinking around the future of that iHeart debt position, given that seems like a deal is not on the table at this point? And how does that affect liquidity for potential buybacks going forward? And secondly, on F1, Chase, if you can just get us anymore color about TT launch, what you've learned, what's gone well, what hasn't, some response or any color on footprints that would be helpful.

Thank you..

So on iHeart first, we remain watchful. I think they're going through their process and well, results, that have been somewhat disappointing.

We do see potential for interesting partnerships or more and we certainly recognize that we have a interesting position which I don't expect to grow right now and it's self-sustaining, we're actually in the money against our cost. And I don't think it will impact our ability to repurchase shares.

We previously went, as you know, and did that exchangeable against a series of doc to raise capital and we're still spending that $400 million authorized. So I think it's a standalone self-sustained element. It has a strategic potential, but it's one that we're going to be judicious about and only execute if we can come up with the right transaction..

And I guess, on the OTT, I think our focus really -- I'm not sure we've learned, I mean, you know, what's going right and wrong, probably not unexpectedly. We've had some of the issues a lot of people do from a -- in building the tech stack to support it.

And whether that lead to the product not launching initially where we targeted and some bugs we have to work out of it.

I think, probably, we certainly expected and recognize that's a part of the reality and this year is much more about getting the product to where we want to both from a content and tech -- now the content won't be -- I mean, the content is probably an 18-month build.

So we'll add content features this off-season and probably add content features next off-season. But it gets really, at this point, about getting the platform right from a technology and content perspective, and then really commercially launching it.

Maybe once you're -- when you're launching it mid-season it really takes away a lot of the abilities to market and push it in the right way. So I think our, sort of in phases, this year's priority is get the product to where we wanted to at this point in time to really give it a proper commercial launch next season.

You know, I think in the [indiscernible] and I call it probably more anecdotal at this point, because their focus is really more on getting platform right, is -- it is very positive fan reaction and some of the specifics, the demographics behind it are great in terms of age, spread and interest from various regions.

We're not obviously in all countries, but I think we're encouraged by the interest -- we're encouraged by the enthusiasm for the product, to use the product that was using the product, the time they're spending on it and just the time we've had it in the market, it only went in, in Barcelona it's up multiples.

So the usage of it, the demographics, the ability to tap into the young market, I think all are encouraging to us, particularly since we're still in the process of -- yeah, we probably have worked through most of the significant technological -- the bugs, but not all. And we still have some content components to add to it.

But I think we feel good about where we're going and this was a product for us. The right thing was to again make sure we do it in a logical way and it's more important to get it right than to do it fast.

And so I think for us, this year is about getting the product to the place we want it to be at this stage of its life and then give it a proper commercial launch into next season..

Great, thank you..

We'll go next to Amy Yang with Macquarie..

Thanks and good morning. I guess, one for Liberty Sirius XM and also one for F1. Liberty Sirius XM, Greg, now that the iHeart transaction has taken a pause, can you talk about how you plan to close the LFXMA spread and maybe the optimal use of leverage for Sirius XM? And then Chase, on F1, I know you prefer shorter term broadcast agreements.

I think you've done ESPN, CCTV any big negotiations coming up? And then I guess, with Miami and Vietnam getting pushed out, does this also push some of the leverage that you have out as well, thanks?.

Oh, Amy, we've talked about some of the reasons why in the past -- the -- as far as spread has existed. We're trying to take advantage of that to the benefit of the Sirius XM shareholders by doing share repurchase at that level using the proceeds we raised in the convertible exchange, the exchange, whatever. And we'll continue to pursue that strategy.

There's probably some limitation of how much leverage we can put at the tracking stock level. It does have the benefit of the dividends from Sirius. Our share is roughly $140 million so it's not nothing, but there's a limit on how much leverage we can put at that.

But we'll consider that and we always have other means to surprise people and eliminate the discount we did on glib. As far as the Sirius leverage, their leverage has been coming down a little, because they frankly had so much cash flow and the stock has run through their credit various times.

But I think they're still targeting around 3 to 3.5 leverage and they're probably at the low end of that right now..

And on Formula One, the television agreements, I mean, the calendar issues really -- I mean, right now we're largely done with our renewal and we got a contract with our renewals which would be for 2019. And so anything happening in the calendar doesn't affect that. And what we'd be moving to at this point -- and we actually feel real good.

I think we can actually see in the agreements some of the success we're having in the sport and the momentum in the sport, we're starting to see any grievance as we move forward and -- but we would be moving to focus on renewals or agreements that would start with the 2020 seasons sort of the races moving to 2020 season, you know, it's actually matching up with anybody we'd engage with.

We have some important renewals next year, probably bigger renewals in 2020. We obviously always have some in every year, but we do have some important ones next year and again probably bigger ones the year after.

I think doing them short has served us well, because again I think the sport today is in a much better place than it was a year ago or even six months ago as we went into the season. And I think you can see that when we engage whether its broadcast or sponsors. There's an excitement about what they think is the direction of the sport..

Okay. Thanks..

We'll go next to Bryin Gilbert [ph] with Bank of America Merrill Lynch..

Oh, thanks. I've got one on the Amazon deal and then another on the race calendar expansion efforts. First, on Amazon, I want to clarify, on the economic impact of this relationship to F1 from a P&L standpoint.

Is this solely going to show up as sponsorship revenue or is there a change in cost at F1 we should be thinking about given the services that they'll be providing you? And I just want to verify, this deal kicks in beginning third quarter of 2018?.

Yes, kicks in second-half of this year and it is -- and I guess, there are two components to it -- sponsorship components recognized as sponsorship and we're getting tech services from them.

And they're services we need to build out the digital capabilities and I guess just like other costs we incur in building out the digital platforms, you know, those costs we recognized, and it's net revenue positive deal to us, but the services are important and obviously the sponsorship relationship is important.

But each will be recognized for what it is.

And in terms of -- what was the calendar question?.

Oh, yes, so as you guys have been hard at work looking at new venues for the tour and also renewing with existing venues and I was just curious, we've read some press around Miami what that relationship might look like and as you just sort of think about expanding the calendar in general, how would you characterize F1's appetite for entering into risk sharing arrangements with local promoters as opposed to fixed fee agreements, what are the puts and takes as you see them from this lever in the model?.

Realistically, every race is unique and I think each one -- we'd look at both on the specific terms and I think people don't realize these events frequently have a lot more moving parts than just to pay their hospitality components, sponsorship components in the title, and the relationship component, other components around it.

But you look at each on the merits and what does it -- what are the direct economic benefits and certainties and we're not afraid of risk if we believe there's an upside to the risk. So we obviously can afford that and I think we like having our promoters have skin in the game.

So I think it's important to have them be -- have that skin in the game to stand behind it. But if we think there are opportunities that have upside both within the event itself as well as upside to us on a much broader level, we would evaluate it on the merits. And if the returns justify the risks, ideally we're going to turn our model upside down.

But if the returns justify the risks, I think we would look at it. I think we would look at that conservatively. So we would want to be comfortable. And again, I think we're not looking to transform our model, but we'd look at each one based on the unique characteristics of that event..

Thank you..

We'll go next to Bryan Kraft with Deutsche Bank..

Hi, thank you. Chase, at the beginning of this year, you had talked about 2018 being an investment year with '19 and '20 being growth years.

Now that we're about two-thirds of the way or almost two thirds of the way through 2018, are you on track with your plans to begin realizing that growth potential, the growth potential of the business in '19? And I realize that you're managing the business for long-term growth rather than margin, but as you get beyond, say, 2020, do you think that the revenue growth will lead to natural operating leverage in the business as you do grow revenue or do you think it's more of a stable margin business going forward but with a better top line growth? Thank you..

See, yes, I mean, first I feel we are on plan. I think we feel actually pretty good about where we are.

And some of that -- I mean that's both financial as well as in reality confidence in the sport, so we're not just looking at the numbers, I think it's also a confidence in the quality of the sport, fan engagement with the sport, so I gave some of the stats on that.

But yes, I think we're actually -- I feel pretty good about where we are in terms of the goals we set out and the objectives we've set out to achieve that.

In terms of leverage, it's a -- we're a fairly unique business, so I'm not sure -- I mean our biggest cost is a contract cost by a large margin, the payment to the teams is not something -- obviously we'll have a new agreement in 2021, but that's a contract cost, so you can't manage that up or down, that's -- it can change in 2021, and changes per years based on what the contract says.

But our operating costs below that are relatively small percentage of our overall revenue. Doesn't mean we don't pay attention to it. We obviously want to watch every dollar. But we are really in many ways a revenue center. As we build out some capabilities there are costs, you build out hospitality there are costs.

There are some that are just pure -- revenue goes through to the bottom line. We get sponsorships. Yes, there's a sponsorship organization, but in some place like hospitality there's cost in providing hospitality. And over the top there is a cost to building out the capabilities to drive those.

We've added overhead, so I think we're probably through the bulk of putting the organization in place to support it. So I think there's some -- if I look at the cost it grows some. We have fairly significant costs for things like production for the television broadcasts, freight that we provide to move the show around the world.

And those things -- maybe freight can move with freight costs, but they should scale as we grow revenue. So there's some places, like expanding hospitality has some costs associated with it as we build out digital platforms there's probably some cost associated with that revenue.

There are other costs that will be, whether it's overhead, television productions, freight that would not have -- there should be leverage on. But in aggregate those costs realistically are still a relatively small percentage of our aggregate revenue. Our biggest cost is the contract cost to the teams..

Okay, thank you, Chase..

We'll go next to Ben Swinburne with Morgan Stanley..

Thanks. Chase, a couple of questions about some of the comments in your prepared remarks, you mentioned that the 2019 calendar you think will look a lot like '18. So should we assume the same number of races? And then the second thing is you mentioned you are, I think, optimistic, you can finalize the agreements in the coming months.

I just want to make sure, is it your expectation or at least your hope that you can finalize sort of the entire Concord agreement, so not just the engine design but sort of everything before the end of the year, just wanted to ask for some clarification on those two?.

So, we haven't announced the '19 calendar, so I guess probably not going to provide more color than I did on the prepared comment. We will announce, and certainly before the end of the month, in the next few weeks we will clearly put out a preliminary calendar. It needs to be approved by the FIA and go through other steps, but it will come out.

But we haven't announced it, so I probably won't go further. In terms of what we're finalizing, certainly we are looking to finance the major components. There will always be components that are sort of moving.

It's not like you're done, I mean particularly when you get into issues like regulations, and they're a living, breathing process that will continue to evolve. So you'll have a set of regulations in place, but whenever you put sporting regulations there's some change, less frequently you get an engine. Obviously that doesn't change that often.

But other regulations will clearly change. And I think with the things we put in place we'll probably continue to find ways, hopefully, to make whatever we put in place better. But when I'm talking about getting on is more than just the engine regulation.

It's talking about a more holistically, probably not completely, but more holistic, getting the major components in place. And I now like to put out a specific deadline for -- I mean one of them -- one of the challenge to bringing it to a completion is it doesn't I mean the actual -- obviously effect many of these things is 2021.

So there is a date, natural deadline. Made easier by having a deadline, you have to get it done by. So I think we all -- I think we and the teams all recognize and know it would be good for us to lock -- to get these things stabilized so we can all plan for the future. So I think there's a shared objective to get it done.

But there isn't a sort of external forcing mechanism in the short term. But I think our goal is to move this forward and try and get it done in the coming months as I said..

Great. And just a maybe a broader followup, I mean I would imagine that you guys have relatively good visibility into the top line of this business. It's underpinned by some nice long-term contracts. I know there is moving pieces. But externally we are dealing with the quarterly accounting which as Greg mentioned is challenging to extrapolate.

When you look at the back-half of the year or you look at this year, do you guys expect revenue to grow for Formula One because it's down first-half? I know it's an investment year, but can you help me provide us, it would be helpful..

Yeah, I mean I guess go back to things I said. I mean in a quarter I think in particular in a year, what races fall where and to some degree when you change the number of overall races and how they flow through have impacts. So I am not going to get into projecting the second half of the year. But we feel good about where we are.

Though realistically and I have said it before, our focus is where we are going to be in 2020. Yes, we care about the short term. But at the end of the day, our real objective is we think we can take this business to another place, and we think opportunity is there do it. So it's -- priority one is really about getting this business to where it can be.

It doesn't mean we take our eyes off the ball on the short term. But for the short term quarter to quarter we will move due to the factors we talked about earlier inside it. But yes, this year we feel good about the momentum in it.

There are issues to deal with whether it's over-the-top or continuing to engage with parties and tell the story and to some degree again create the right momentum in a business. We probably didn't have the momentum a year ago..

Yes, okay, thank you..

We will go next to Jason Bazinet with Citi..

May be just a question for Mr. Carey, this is before your time and it could be wrong because it's based on press reports. When I look those team payments, it looks like they were in much smaller percentage of the overall EBITDA than it is today. It is something in the 40s and it went to 50s and 60s and now we are in sort of in the 70s range.

Is that accurate if I go back 10 years that there has been that sort of steep rise? And then as we go forward, what would you like to see? And can you just remind us, I think there was a time when you tried to issue some equity to the racing teams to sort of get it all on the same page, so incentives were aligned.

But what -- the reason I ask is that's probably the biggest to everybody's model because I think everyone agrees that the top line can inflect to 19 - 20. And those other costs you said are small. But it's a big cost is sort of -- it's a big one and it's a big unknown.

So any color that you can provide in terms of what you would like to see?.

First your statement on the long-term trend going back is accurate. I mean I think actually if you go back to the early 2000s -- and I am doing it off the top of head, so yes, somebody ought to check it. I think the percentage was 25% to 30%. And today it's more in the high 60s sort of closer to that range, closer to 70.

First for 19 to 20, it's locked in. So realistically, it is what it is through 19 and 20. It's to the degree let the revenue distribution is both amongst the teams and between us and the teams is what is part of those longer term discussions for 2021, but that's up the first year we did that.

Since those discussions we are having with teams, again I am not going to I guess I think those are discussions at this point we are best having with the team is private. And then when we get to the place that we -- when we finalize that, we would be happy to again discuss where we at and what we think the opportunity is under that revised structure.

But since those are live discussions with the teams, I am not going to really comment a lot on that. Those are best still had in a private room between us and the teams..

Understood. Okay, thank you..

We will go to our last question to John Tinker with Gabelli..

Thank you.

Just to switch gears on to Atlanta Braves, which had a very solid EBITDA number; the team is generally valued on revenue, so how do you sort of look at the team when you think about how to value it?.

Well, I would say in general, we look at some of the metrics that people talk about for third party valuations. You are right, teams are often not valued on EBITDA partly because many baseballs teams do not make significant if any money.

We are in the blessed position of actually having a profitable team partly based on the demo run, partly based on some of the other things, we have done around things like the Battery, and we will see how that all plays out.

I don't think there is an obvious answer, John, which -- how to do it because they don't -- we are relatively rare item, obviously the only publicly-traded team with an unusual structure and an incremental asset in the battery. So it's a little hard to look at apples and oranges..

And so, could just given the new developments you had with [indiscernible] so much land has been developed and how much is left to develop?.

We are -- everything that we can we have blocked and set out, either been done or we have announced a plan..

So, yes, John, there is not an infinite supply this stuff out there, pretty valuable location..

And the IRR of 22% that you are targeting for the sale of the residential properties, is that something you think crosses over the rest of the Battery development or is that your sort of most successful part so far?.

We'll see, but clearly you just look at the market, residential is probably hotter than something like retail for example. The nature of the deal we cut and the nature of the how it works, we will unlikely get that kind of return on the hotel portion.

But those will be the two that would be probably the lesser end and residential at the higher end, but there are others I think office market is pretty good, you know, there will be a range..

Thank you..

And that concludes today's conference call..

Thank you, Operator. Yes, I think we are done with today's. Thanks everyone for joining us. And we hopefully will talk to you next quarter if not before..

Thanks a lot everybody..

And that concludes today's conference call. Thank you for your participation. You may now disconnect..