Specialist
Former executive at VER Entertainment Services (Resource Group LLC)
Agenda
- Live events production industry trends and developments
- Production Resource Group's positioning vs peers
- Unit economics and pandemic-related tailwinds
- Post-pandemic growth outlook
Questions
1.
Could you share your expectations for the live events industry over the next 12-18 months?
2.
How do you assess the headwind from continued vigilance against coronavirus? Does the vaccine roll-out have an impact on this?
3.
How are venues and operators using vaccine roll-outs as a proxy to determine capacity? In an Interview on Live Nation [see Live Nation – Events & Entertainment Recovery Outlook – 3 June 2021], it came up that MSG [Madison Square Garden] is opening for the Knicks at 75% capacity, and I don’t believe New York is over the 50% hump for vaccination rates.
4.
How could capacity constraints lead to lower ROI for players, particularly in the production segment? I imagine that production generally would not be hindered by how many people are in the crowd – businesses would still want the production to be optimal for their audiences.
5.
Could you estimate the live events production industry’s TAM?
6.
How would you break out revenues for the industry across segments including Broadway, trade shows and music?
7.
You touched on pricing and the supply that’s coming online from the pent-up demand within the concert segment. Are there any concerns or key risks that we should consider around the vendors supporting these productions?
8.
Could reuse of existing gear sets improve the economics for a player such as PRG [Production Resource Group], given it wouldn’t need to invest in new equipment?
9.
How do you assess PRG’s revenue mix in a post-pandemic world, given you outlined your industry-wide mix expectations? You mentioned that PRG is most exposed to Broadway, or a big piece of its mix is Broadway, so what could change or stay the same?
10.
How do you assess the long-term profitability of PRG with reference to the contribution margins from each of its different segments? What should we expect for margins across Broadway, TV, music and corporate events?
11.
You said that the industry and even PRG will have to rely on used equipment to service customers due to balance sheet headwinds coming out of the pandemic. Could this potentially put margins in trouble, given that used equipment sales may no longer be viable?
12.
How large are PRG Gear, Proshop and the event production services arm?
13.
Could you outline the competitive landscape? You suggested dynamics could become more favourable given some smaller players might not bridge to a post-pandemic world. Who are credible threats to PRG’s business? Are there any potential take-out targets for it?
14.
What are your thoughts on Freeman and NEP’s competitive positioning vs PRG? How would you rank them?
15.
How challenging is it to enter and disrupt the live events production industry, or even just to overtake the strong legacy players? What are the barriers to entry?
16.
What are your thoughts on PSAV, now known as Encore? How does it fit into the industry?
17.
How siloed are PRG’s businesses, including PRG Gear, formerly VER? Would you say they’re kept separate in a way that prevents efficient cross-selling?
18.
What are your thoughts on PRG’s sales team and its structure? How could it evolve post-pandemic?
19.
Could you comment on PRG Alliance and its network of global players?
20.
What’s your outlook on PRG’s announced roll-out of Digital Studios Worldwide, going off of this global alliance? The press release stated that this is an effort to meet virtual production demand. What impact could this have on revenue and profit streams?
21.
How would you say PRG’s cash flows are reacting to the current environment? How could this play out into 2022, given the supply coming online that you mentioned earlier? What’s your take on cash burn in H2 2021?
22.
What are your thoughts on PRG’s debt load?
23.
How would you characterise PRG’s contracts or relationships with suppliers, perhaps focusing on the Proshop and PRG Gear segments?
24.
Could you comment on the labour component for PRG? May PRG have lost any key talent off the back of the pandemic?
25.
Could you expand on how the industry is snapping back and the constraints to this rebound?
26.
How do you assess PRG’s revenue and profitability over the next five years, once pent-up demand is satisfied and the industry normalises?
27.
Could any gaps in PRG be filled in-house or inorganically?
28.
What are your thoughts on PRG’s management team and its structure? Are there any moves you would question?
