Good morning. Thank you for standing by, welcome to the Madison Square Garden Sports Corp Fiscal 2023 Q2 earnings conference call. At this time, all participants are in a listen only mode. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the 1 on your telephone keypad. I would now like to turn the call over to Ari Danes, Investor Relations. Please go ahead. Thank you. Good morning. Welcome to MSG Sports Fiscal 2023 Q2 Earnings Conference Call. To begin, I'd like to welcome our new President and COO, David Hopkinson, to today's earnings call. David will provide an update on the company's strategy and operations. This will be followed by a review of our financial results with Victoria Mink, our EVP, Chief Financial Officer, and Treasurer. After our prepared remarks, we will open up the call for questions. If you do not have a copy of today's earnings release, it is available in the investor section of our corporate website. Please take note of the following. Today's discussion may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Please refer to the company's filings with the SEC for a discussion of risks and uncertainties. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call. On pages four and five of today's earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating income or AOI, a non-GAAP financial measure. With that, I'll now turn the call over to David. Thank you, Ari. Good morning, everyone. I'm delighted to be here speaking with all of you today. I look forward to meeting with many of you in the coming months. I am honored to have taken on this new leadership role at MSG Sports. Our company has a collection of iconic professional sports assets, and with significant opportunities for growth ahead, I am excited to drive the business forward and realize this potential. Our portfolio is highlighted by the Knicks and the Rangers who kicked off their 2022-2023 regular season in October. Following on last year's record financial performance, I'm pleased to say that we have continued to build on that positive momentum this season as consumer and corporate demand remains robust. The strength of our business is reflected in our fiscal Q2 results. With revenue of $354 million, an increase of 22% year-over-year, and Adjusted Operating Income of $77 million, up 38% as compared to the prior year period. This growth was broad-based with total revenues as well as per game revenues across tickets, suites, sponsorship, food and beverage, and merchandise all up year-over-year as compared to the fiscal 22 Q2. As we look ahead, our strategy remains focused on continuing to execute on our many opportunities for growth, from offering new ticketing and premium hospitality products, to forging deeper relationships with our fans, to strengthening our brands globally. Based on our current trajectory, we are positioned to deliver year-over-year growth across key revenue lines this fiscal year. Our announcement in October to return $250 million to our shareholders reflected this momentum, coupled with our confidence in the underlying value of our marquee professional sports franchises. Now let's discuss in detail how our business is performing. Our teams are more than halfway through the NBA and NHL regular season, and both the Knicks and Rangers have talented rosters, including the Rangers' Igor Shesterkin, Adam Fox, and Artemi Panarin, who participated in the NHL All-Star Game this past weekend. The Knicks' Julius Randle, who was recently selected as a 2023 NBA All-Star. Both teams are currently in playoff contention, and we look forward to the coming months of exciting competition. We continue to be energized by our fans, whose enthusiasm for our teams has only grown stronger during the last few years. Our average combined season ticket renewal rate is above 90%, and we have also seen strong sales of new season ticket packages. As a reminder, season tickets represent the significant majority of our ticketing revenue. We're also pleased to say that our group and individual ticket sales have returned in full force, which reflects improving tourism as well as our enhanced results across dynamic pricing and improved efficiencies in data analytics and marketing. In fact, average tickets sold per game for individuals and groups through the fiscal Q2 has not only significantly exceeded the prior year quarter but has also exceeded the pre-pandemic Q2 of fiscal 2020. This robust demand, combined with higher average ticket yields, drove substantial year-over-year growth in ticketing revenue this quarter, with both the Knicks and Rangers maintaining their position amongst the league leaders in average gate receipts so far this season. Beyond ticket sales, we have seen the enthusiasm from our fans again lead to increases in per capita spending across food and beverage and merchandise in the fiscal Q2 relative to last year, which as you may recall, was a robust year for guest spending. We are strengthening and growing our fan community using a multi-pronged approach to forge impactful, direct relationships with our customers at multiple touch points in their experience. On the merchandise front, we have continued to introduce bespoke product offerings to build connections with guests while driving business results. We are once again partnering with popular streetwear fashion brands such as Jeff Staple with the Rangers and Kith with the Knicks to create new collaborative collections this season following prior year's success. In fact, in November, we also named Kith founder and CEO, Ronnie Fieg, as our first ever Knicks Creative Director. In addition to developing an in-house line of products, Ronnie is focused on helping to provide a distinctive look and feel across our marketing, content, and merchandise initiatives. We're extremely excited to have Ronnie join us for this continued and expanded collaboration that we believe will further develop a global community around our iconic Knicks brand. On the Rangers side, we recently welcomed thousands of our fans to watch the team's first ever opening practice at the Garden, giving them the opportunity to get up close and personal with their favorite players. Another great example of the unique ways in which we look to connect with and develop our next generation of fans. Our efforts to foster our fan community also extend outside of the arena. Across our social media platforms, we've been rolling out compelling exclusive content, including behind-the-scenes player interactions, locker room footage, and lifestyle look-ins. It's clear this content is resonating. So far this fiscal year, we have added over 600,000 net new social followers across both teams, bringing our combined total following to over 17 million across our social channels. As we continue to demonstrate through co-branded social media content, our global marketing partners view this social content as a unique avenue to connect with both our avid and casual fans. Our marketing partners have also continued to demonstrate solid demand across all of our assets in fiscal '23. In partnership with MSG Entertainment, the first half of the fiscal year was highlighted by extensions with signature partners Verizon and Spectrum, as well as with other brands such as Dunkin' and Jägermeister. At the same time, the company has made strides into expanding into new categories, and we welcomed leading insurance brokerage firm, Hub International, as a signature partner earlier this year. As a reminder, this fiscal year for the first time, we are also realizing the full run rate impact of our expansive deals with sports gaming companies BetMGM, Caesars Sportsbook, and DraftKings. Our sponsorship momentum demonstrates the strength of our brand and our expansive reach in the New York market and beyond. With the NBA's expanded international sponsorship opportunity beginning this year, we are increasingly focused on growing our commercial opportunities globally for the Knicks. To that end, we recently announced MSC Cruises as the official cruise line partner and first official global partner of the Knicks. We fully expect this global partnership will be the first of many as we remain confident in the reach and appeal of the Knicks internationally. Corporate demand has also extended to our premium hospitality business. We have seen robust renewals and new sales of suite licenses through the first half of the year, positioning us for continued growth in this category. On the media rights side, we continue to see increases in local and national media rights fees due to annual contractual rate uplifts. With the NBA media rights renewals coming due after the 2024-2025 season, we remain confident in the opportunity ahead. Before I turn the call over to Victoria, I'd like to touch on the recent third-party valuations for the Knicks and Rangers. In December, Sportico published its annual ranking of NBA team valuations, with the Knicks coming in at an estimated $6.6 billion, up 8% from last year. That same month, Forbes updated its NHL team valuations, with the Rangers maintaining the top spot at $2.2 billion, a 10% increase year-over-year. There continue to be record transactions for professional sports franchises, as evidenced by the recent Phoenix Suns news. Just two months ago, the Suns were valued by Forbes at an estimated $2.7 billion. Now, with a reported sale price of $4 billion, the Suns are delivering the highest-ever sale for an NBA team. We feel great about our position, owning two iconic franchises that have dedicated fan bases and play in the largest media market in the country. We remain encouraged by the continued increases in estimated team valuations along with the transactions that continue to come in well above those estimates. Our recent share buyback program is a demonstration of that confidence. Recognizing the gap that persists between the current trading price of our stock relative to the intrinsic value of our marquee sports franchises. With more than half of fiscal 2023 already behind us, we're proud of how our business is performing, and we remain confident in our ability to generate long-term shareholder value. With that, I'll now turn things over to Victoria. Thank you, David. Good morning, everyone. I would like to start by reviewing our fiscal 2023 Q2 financial performance and then provide an update on our balance sheet. Results for the fiscal Q2 reflect preseason play and the start of the 2023 regular seasons for the Knicks and Rangers. In aggregate, we hosted 41 pre and regular season games across both teams as compared to 35 games last year for 6 more games, which positively impacted this quarter's results. I'd also note that our fiscal Q3 will reflect 2 additional home games, while our fourth quarter will reflect 8 fewer regular season home games, both as compared to the prior year periods. Turning to results for the fiscal Q2, total revenues were $353.7 million as compared to $289.6 million in the prior year period, with increases across all key revenue lines. Event-related revenue of $142.3 million increased 30% year-over-year. This mainly consists of ticket-related revenue as well as food, beverage, and merchandise sales, both of which saw higher average per game revenue driven by the enthusiasm from our fans. The increase in event-related revenue also reflected the additional games played at The Garden during the current year quarter as compared to the prior year period. National and local media rights fees of $118.2 million increased 5%, primarily due to the impact of contractual escalators of both our local and national media rights agreements. Suites and sponsorship revenues of $81 million increased 38% due to a higher number of games year-over-year, as well as an increase in per game revenue for both suites and sponsorships. These results reflect the demand we have seen for new suite licenses at The Garden and robust renewals. While sponsorship includes the full run rate impact of our sports betting partnerships and the impact of the NHL's new Digitally Enhanced Dasherboards. Adjusted operating income increased 38% to $76.6 million as compared to the prior year period. This improvement was driven by the increase in revenues, partially offset by an increase in direct operating expenses and to a lesser extent, higher SG&A expenses. The increase in direct operating expenses reflects higher team personnel co-compensation as well as other team operating expenses. The increase in SG&A expenses was primarily due to higher employee compensation, reflecting executive management transition costs recorded in the current year period, as well as higher marketing costs. We continue to expect our business to deliver growth across key revenue lines in fiscal 23, while our AOI will also reflect higher team operations expenses. Turning to our balance sheet. David mentioned earlier, in October, we implemented a program to return approximately $250 million to our shareholders. This was comprised of an approximately $173 million special cash dividend and a $75 million accelerated share repurchase program, which was completed in January. In total, the company repurchased approximately 456,000 shares at an average price per share of approximately $164, representing about 2% of Class A common shares outstanding prior to the buyback. We now have approximately $185 million remaining under our existing share repurchase authorization. In connection with the special dividend and share repurchase, the company borrowed an additional $55 million under the Knicks revolving credit facility and $160 million under the Rangers facility, of which $30 million in total was subsequently repaid during the quarter. At the end of the quarter, we had $435 million of debt outstanding, comprised of $260 million under the Knicks senior secured revolving credit facility, $145 million under the Rangers senior secured revolving credit facility and $30 million advanced from the NHL. I would also add that in addition to the $30 million of total debt repayment in the quarter, last week, we paid down an additional $15 million on the Rangers revolver. Our quarter-end cash balance of approximately $44 million represented a net decrease of $37 million compared to our September 30th balance of $81 million. With regards to liquidity, as of December 31st, we had $164 million of liquidity comprised of $44 million of unrestricted cash and cash equivalents and $120 million in borrowing capacity under the team's revolving credit facilities. Based on the momentum we continue to see in the business and the growth opportunities ahead, we remain confident in our ability to drive long-term value creation for our shareholders. With that, I will now turn the call back over to Ari. Thank you, Victoria. Operator, can we now open up the call for questions? At this time, I would like to remind everyone in order to ask a question, press star then the number one on your telephone keypad. Your first question comes from the line of Brandon Ross from Lightshed Partners. Your line is open. Hey, good morning. David, you mentioned the Forbes valuations and those recent sales of teams at pretty hefty prices, most relevantly the Phoenix Suns sale. But that's nothing really but illustrative for investors without a sale of the Knicks or Rangers, or at least a minority sale as a mark. Are either of those things in your consideration set? Hi, Brandon Ross. Good morning. Let me start by saying that we're as confident as ever in the value of our teams. You know, these are incredibly scarce assets. They've got strong business fundamentals that we just reviewed, and we believe they've got significant opportunities for long-term growth. As I mentioned in my remarks, we just don't think that is appropriately reflected in our current stock price. That was one of the reasons that we made to these, the recent share repurchase. There's also changes in the ecosystem. You know, the NBA has recently allowed for private equity to come into the marketplace as well as sovereign wealth funds. We've got new pools of capital available. To answer your question, we have no plans to sell either team. Since you asked about the Knicks, no current plans there, but we would certainly not rule out the possibility of selling a minority stake in the Knicks or the Rangers. Got it. Thank you. Your next question comes from a line of David Karnovsky from JPMorgan. Your line is open. Hi, thank you. David, just given the potential for major bankruptcies in the RSN space that could significantly impact distribution for, you know, the NHL, NBA, how are you thinking about risk to your own distribution over the next several years and the potential need to maybe adjust existing terms or payments you receive, if only to establish a wider or more sustainable carriage for your games? Thanks, David. That's a good question. If we take a step back, we all know and we can see that the media landscape is evolving. We believe strongly in the value of live professional sports content, and especially in the case of premium content like the Knicks and the Rangers. We're happy that we operate here in the nation's largest media market. That benefits us, and it benefits our partner, MSG Networks. You know, sports rights we've seen proven over and over is a great investment, especially over the long term. We have confidence as we look ahead. In answering your question specifically, you know, I want to flag for you that we've got long-term local media contracts in place with our partner, MSG Networks. Those agreements provide exclusive local distribution of all of our live content, including our digital rights. MSG Networks have been great partners, and we're really supportive of what they've been doing on the distribution front, including in terms of new digital offerings. Recently, MSG Network announced plans to launch a direct-to-consumer offering in our market, a product that's designed to appeal to sports fans that do not currently subscribe through a traditional linear package. We're also pursuing a variety of additional ways to increase engagement and grow our reach amongst our fan base, especially on social media. A priority for us is delivering compelling exclusive social media content, giving our fans behind-the-scenes player interactions, locker room footage, live look-ins. We think it's working. We've added 600,000 new social followers across both teams so far just this season alone, and now have a total social media ecosystem of 17 million followers across all our social channels. Social is a priority for of ours. Pardon me, social is a priority for us. As the media landscape evolves with DTC offerings, we're gonna complement distribution outreach using social media. Okay. Maybe for Victoria, you know, both the Knicks and Rangers as of today are playoff teams, which means potentially playoff revenue. I guess, how should investors think about potential use of, you know, fiscal year, fiscal year-end cash flow, assuming you guys have deep runs? Sure. Thanks, David. All right. First, you know, let me say we are really looking forward to the coming months of, you know, what's sure to be really exciting competition. Just as a reminder, we were really pleased last year with the financial impact of the Rangers' playoff performance, which drove significant increases in revenue and AOI for the 10 home games playoff games that we played. We're definitely excited for the remainder of the season. When we think about what to do with the potential of the excess cash flow, you know, our near-term focus continues to be on, you know, paying down debt, right? As we talked about, we borrowed $215 million in addition to the cash on hand that we had generated in order to return $250 million to our shareholders. You know, as you've heard us discuss, of course, this return of capital was a reflection of the strength of our business, which has continued through this fiscal year so far, as well as our confidence in the value of our sports franchises. You know, when we look ahead and think about our capital priorities, you know, they're generally the same. Certainly near term is, of course, to maintain that appropriate liquidity to fund our operations and invest in our core business, right? Importantly is to keep a strong balance sheet. We will, you know, as I mentioned, continue to focus on paying down debt in the near term. The $30 million we paid in the quarter and then another $15 million over the last week. Third, you know, or I guess our longer term capital considerations. We would, of course, consider other uses of our cash flow over time, you know, including another return of capital potentially in the future. Thank you. Your next question comes from the line of Ben Swinburne from Morgan Stanley. Your line is open. Thanks. Good morning. David, welcome to the call. Nice to meet you over the phone. Wanted to ask you about sort of the corporate demand backdrop. You mentioned really strong suite renewals and sponsorship trends, but we are seeing corporate spending, you know, pretty soft in the advertising marketplace. We're seeing layoffs, obviously, in a lot of sectors like tech. Can you just tell us what you're seeing when you look out into the forward bookings and also just the nature of these multi-year contracts? You know, would you have already seen weakness in your business if it were to show up or might that be ahead of us? Then I just wanted to ask Victoria if she could maybe pick up on her last answer. Is there a way to think about leverage at this company in terms of more traditional metrics, whether it's debt to EBITDA or debt to value the teams? 'Cause I know you're paying down debt, but it would seem like you've got a lot of capacity if you wanted to use more. Obviously, the sort of league, you know, oversight plays a role as well. I'd be curious in your thoughts there. Thank you both. Great. Thanks, Ben. I'll tackle the first half of that. Then I'll let Victoria answer the second part of your question. The short answer is no. We're just not seeing an impact on our business other than a really strong demand for the product. You know, look, like you, we're really mindful of the broader macro environment. If I look across sort of three big sectors of our business, all of them are really strong. Ticketing, as I mentioned, you know, we had season ticket renewals that exceeded 90%. Strong sales for both teams. Strong demand for new packages. Strong group and individual ticket sales. You know, as I mentioned in my remarks, you know, the group individual ticket sales exceeded last year's Q2. They were also above the pre-pandemic Q2 in 2020. Tickets on an individual basis look better than ever. Specifically with respect to corporate demand, our business remains strong. If I think about sponsorships, you know, we're seeing, as I mentioned, the full run rate of mobile sports gaming with our 3 partners in their first full year with us. We see great demand for new offerings in the marketplace. The NHL introduced the Digitally Enhanced Dasherboards this year. We're seeing great demand from on that inventory from our partners and have introduced the new partners, the renewals and with Spectrum, Verizon, Dunkin', Jägermeister, a new deal in HUB. We're seeing strong demand from the corporate sector. We think we've got opportunity for headroom as well with both international as an opportunity for the Knicks and patch partners yet to come for both Knicks and Rangers. With respect to the suites and premium products, we had a great year for renewals. We're having a great year for new sales. In conclusion, we're taking none of that for granted. We're working hard every day. We follow the economy like you do, but so far, we're seeing absolutely no softening whatsoever, and in fact, really robust demand. Great. Wanna take over from there? Yep. Sure. Yes. We have not publicly provided an official target, you know, but I will say it is certainly something, you know, that we're thinking about and that we are discussing internally. Right, you're correct, the leagues do have oversight as to the amount of debt that, you know, either one of the teams could carry. You know, sort of, as we mentioned, you know, we feel very good about, you know, our overall liquidity position, the amount of debt that we currently have outstanding. Again, we, you know, we just think it's prudent to use our excess cash flow at this time, so to just continue to pay it down given the overall cost of borrowing these days. Like I said, it is certainly something that we spend a lot of time thinking about. At the end of the day, when I, when I really take that step back, it's really the trajectory of the business that we, you know, that we feel good about and our ability to generate free cash flow and, you know, and then it's the potential as to what we can do with that cash going forward, you know, again, with some variety of capital allocation and opportunities that are out there, you know, including returning money to shareholders as we did, that we, you know, we were very pleased to be able to do. Great. Thank you. Your next question comes from the line of Devin Brisco from Wolfe Research. Your line is open. Thanks. My question is related to the upcoming NBA national TV rights renewal. The values that are being talked about are multiples higher than the current deal. Could you talk about how strong the flow through of incremental revenue to cash flow could be from a new deal and if and how it would change your capital allocation priorities? Sure, Devin. First off, right, we continue to believe in the value of live sports, and particularly as well as our league's appeal domestically and internationally. We fully trust the NBA to maximize the opportunity, you know, when the time comes. You know, which sort of just as a reminder, that's gonna be after the 2024, 2025 season, which is where the current agreement runs through. Sort of what we're talking about would be, you know, out into our fiscal 2026. Specifically, to answer your question, in terms of that financial impact, you know, all teams across the league would share equally in the increase from national media fees. You know, with a net impact of, I would say, roughly about half before revenue sharing, dropping down to increase our AOI. You know, certainly, some, you know, good potential for a positive financial impact. You know, when I talked about the capital allocation policy a little earlier, you know, it was sort of focused a bit more on the near term in terms of the, you know, potential for excess cash flow on, you know, with playoffs. I think, you know, thinking out several years, I think the priorities still remain the same in terms of maintaining, you know, a healthy balance sheet, maintaining enough liquidity for our ongoing operating needs. Again, you know, from a longer term perspective, which is I think sort of what we're talking about here, is that opportunity for additional returns of capital. Thank you. Your next question. Thanks, Devin. Your next question comes from the line of Paul Golding from Macquarie Capital. Your line is open. Thanks so much. I was hoping we could dive a little deeper into some of the comments earlier around the sponsorship space. In terms of cohort, is there any color you could give? It's apparent that the mobile sports betting cohort and seemingly media as well, has been strong. Are they sort of mopping up any excess supplier inventory sort of in the spot market from others that might be weaker? Is it pretty much all spoken for in terms of the strength that they're able to deliver as the largest component of your sponsorship revenue? Secondly, I just wanted to see if we could get a little more color on the jersey patch sponsorship process. Thanks so much. Yeah, sure thing, Paul. Look, those are really good questions. With respect to the 3 mobile gaming partners that we have, DraftKings, BetMGM, and Caesars, you know, that was a big focus for us. When that category was introduced, we wanted to make sure that we were able to maximize that opportunity. We're really happy with where we landed there, not just from a revenue perspective, but also from a brand perspective. We believe we found the right partners and the right mix to, you know, fully profit from and benefit from that new opportunity. We think about the partnerships business in those 2 dimensions that you mentioned. 1 is category and 1 is inventory. I was pleased to introduce Hub as a signature partner of ours new this season, which was an important category for us. Insurance brokerage is an important strategic category, and I'm glad that we filled that opportunity with such a strong partner and good economics underpinning that deal. We'll continue to look for key categories that we can sell to the right partner on an exclusive basis on the right package. When it comes to inventory, the sort of the second half of your question and on jersey patches, you know, we currently are not playing with a patch on the Knicks jersey. We've got that opportunity open and available, and we believe that when the right deal presents itself, which we're working on on a daily basis, we'll conclude that. For us, it's about the right partner, the right economics, and we're prepared to sit and work that category because it's such a strategic priority for us. We wanna make sure we get the right deal done. With the Rangers, we're taking the exact same approach. The NHL introduced that opportunity just at the beginning of this year. We are watching the marketplace very closely because baseball has also introduced the sleeve opportunity this year. It's a noisy marketplace out there. I really believe that we've got to work this every day and conclude the right deals, not necessarily the quickest deal. However, when we do so, whether it's the Knicks or the Rangers or ultimately both, we've got material upside in our partnerships business. Great. Thanks for the color. This ends our question and answer session. Mr. Ari Danes, I'll turn the call back over to you for some final closing comments. Thank you all for joining us. We look forward to speaking with you on our next earnings call. Have a good day. Good- This concludes today's conference call. Thank you for your participation. You may now disconnect.