WWE will re-examine finances to account for Vince McMahon’s personal payments



WWE will review financial statements dating back to 2019, saying a total of $14.6 million in “certain payments” made by Vince McMahon while he was chairman and CEO should have been recorded as expenses.

McMahon announced Friday that he is retiring from WWE. That came five weeks after he said he would step down as the company’s chairman and chief executive amid an ongoing investigation into allegations he paid several women millions of dollars to keep quiet about alleged affairs and misconduct.

On Monday, WWE disclosed in an SEC filing that it “has made a preliminary determination that certain payments Vince McMahon agreed to make during the period 2006 through 2022 (including amounts paid and payable in the future) and that recorded in WWE’s consolidated financial statements should have been recorded as expenses in the quarters in which these arrangements were made.”

WWE said the investigation into allegations of McMahon’s misconduct by the board’s special committee (consisting of independent members) “remains ongoing.” It also disclosed that it has received “regulatory, investigative and enforcement inquiries, subpoenas [and] lawsuits” in connection with McMahon’s alleged misconduct.

Those payments were or will be paid by McMahon personally, according to the company. However, WWE said that while they were not material in any individual period, the total amount of $14.6 million “would be material if fully recorded in the second quarter of 2022.” As such, the company currently anticipates that it will revise its previously issued financial statements to record McMahon’s payments in the applicable periods for 2019, 2020 and 2021, as well as the first quarter of 2022, when it issues its second quarter financial statements. quarter of 2022.

Since the payments McMahon made over 16 years while leading the company were not reflected in its financial statements, “the company expects to conclude that its internal control over financial reporting was not effective as a result of one or more significant weaknesses.”

WWE said it aims to issue revised financial statements by August 9, 2022, but “there is no assurance that it will be able to meet that deadline.”

The company on Monday released preliminary results for the second quarter of 2022. WWE expects revenue of $328 million for the period (up 23% year-over-year), operating income of $70 million (up 52%) and revenue of adjusted operating before depreciation and amortization of $92 million (up 35%). Adjusted OIBDA for the second quarter of 2022 is above the high end of the company’s previous guidance of $80 million to $90 million.

WWE shares rose more than 8% in morning trading on better-than-expected second-quarter results.

WWE also officially announced Monday that its board of directors named Stephanie McMahon and Nick Khan as co-CEOs following Vince McMahon’s resignation. Stephanie McMahon, who is Vince’s daughter, has also been named chair of the board, and Khan will continue to serve as a board member.

In addition, WWE Vice President of Talent Relations Paul Levesque, aka Triple H, will assume all creative responsibilities for WWE following Vince McMahon’s departure, in addition to his regular duties, he say the company Levesque is married to Stephanie McMahon.

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About the Author: Chaz Cutler

My name is Chasity. I love to follow the stock market and financial news!