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After the board handled some internal business, Vince McMahon was introduced. McMahon joked that they had rotten tomatoes in the back in case any stockholder wanted to take aim at him for the dividend change and promised to stay at the end to accommodate any upset holders.
McMahon said the reason for the change was that they have a better way in returning shareholders' values than just paying a dividend. He said they have a better way that would be explained in terms of acquisitions and investing in themselves.
George Barrios, the CFO of WWE, took over and explained that the new dividend will pay stockholders .12 cents a quarter. Barrios said he wanted to explain why the change was made. He said that the rationale was that they wanted to size it to the company's cash flow. He said the new dividend gives them the flexibility to invest in their future. He said that they want to make sure that the company can always support its own solvency in the long-term after the recent economic upheaval everyone has gone through. They want to make sure the company is always liquid. He noted they need to continue to invest and grow the company's core business. He said that they need to support their internal projects, such as digitizing their library, which is almost completed. He said they want to come up with ways to leverage the scale of their company, whether its live event, home video or new ways of creating content. He said they all this will allow them to return capital to shareholders.
Vince asked Barrios to take questions on the changes.
It was noted that Wall Street is worried about WWE's guidance going forward and asked for a prediction going forward. They declined to discuss future earning projections and said everyone in involved in a very low period. Barrios noted that there is a land grab for content with all the new platforms going on and right now, they are in a great place as a content owner that has a lot of content and 100% ownership of that content.
A stockholder asked about changed in the Board over the last year. Barrios said that the company always has changes to do the best it can and others make personal decisions. Barrios declined to comment on others' decision.
A stockholder asked about the company's balance sheet. Barrios said that the sheet is good and they have no debt right now. He went for awhile about the company's financials.
A stockholder praised them for cutting the dividend given the environment in the world today.
It was noted the company paid $36 million in taxes last year and asked why they still feel the need to be a public company since they could easily buy out the minor shareholders. Barrios quoted Vince and said that The Board thinks about its capitol structure a lot. Vince however likes the halo effect and the discipline that being a public company brings to the company and that it brings good management to the company. He said that Vince also likes being involved in the capitol and equity markets.
A stockholder suggested studying "ancient versions of wrestling such as Japanese and Greco-Roman" styles to improve the company.
A stockholder asked about the new business model for WWE. Barrios said Michelle Wilson would discuss it in detail but they want to grow the company.
The WWE Studios division was brought up. The stockholder asked whether the company was sticking to budget to prevent them from losing money as they had on some of the older projects. They are trying to spend a net $5 million on each project. Barrios said that as they've moved their Studios model from a license model where they partner with others and recorded WWE revenue after the partners made their money, now they everything comes on their books as a self-distributed model. They will tend to have a loss on release because the remaining revenue comes later (DVD, etc.) so the financials will be tough to read as they continue to convert to the new model. They are managing the Studio to deliver them more than they spent on the projects.
Barrios was asked if there was any talk of spinning off some of the lesser sections of the company. Barrios said they want to grow for the long term. You will invest in some areas and not invest in others at time. They want to do what they can to grow the business.
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