Forbes Franchise Value Article

[Eddie_Shack]

Interesting read

Hockey's Most Valuable Teams - Forbes.com


But when it comes to the P&L statement, the NHL has become a two-tiered league. During the 2009-'10 season the 30 teams combined to generate $160 million of operating income (earnings before interest, taxes, depreciation and amortization) on revenue (net of proceeds required for arena debt) of $2.9 billion. But seven teams (the Toronto Maple Leafs, New York Rangers, Montreal Canadiens, Red Wings, Philadelphia Flyers, Black Hawks and Vancouver Canucks) combined to earn $241 million, with none making less than $13 million. Meanwhile, 16 teams were in the red, with the six biggest money-losers (Phoenix Coyotes, Florida Panthers, Washington Capitals, Atlanta Thrashers, Buffalo Sabres and Tampa Bay Lightning) dropping an aggregate of $63 million.


Does anyone know how to explain this funky economics to me? There's no way the seven teams show a profit greater than the entire league due to so many teams bleeding dough. Maybe DevilishWon can explain this one... unless he's too busy orchestrating a second Great Recession.

Also how are the Sabres losing money?

 

[Mintyp69]

The leafs can print money, they have a solid fans base and a season ticket base that any team would kill for. The Rangers..well it's all in the pricing and people pay buca bucks to watch the blue shirts to play. Canadiens last year had their centianal of sorts so there was products and events glalore. Red wings..well that I have no idea, but hte red wing name is synoamus ( sp ) with Hockey and is a respected name. Flyers, they've been having a resurgence lately and they changed out jersey's last year so that product helped bump the #'s. Black Hawks...Towe's and Kane..that;s why, over hte last 2 years they've been on the up and and up and with them making the playoffs and the final people who thought hockey was dead in chi-town started buying up product once again. Canucks, another one I'm not to sure of as to why..These are my theories anyway

 

[Eddie_Shack]

The leafs can print money, they have a solid fans base and a season ticket base that any team would kill for. The Rangers..well it's all in the pricing and people pay buca bucks to watch the blue shirts to play. Canadiens last year had their centianal of sorts so there was products and events glalore. Red wings..well that I have no idea, but hte red wing name is synoamus ( sp ) with Hockey and is a respected name. Flyers, they've been having a resurgence lately and they changed out jersey's last year so that product helped bump the #'s. Black Hawks...Towe's and Kane..that;s why, over hte last 2 years they've been on the up and and up and with them making the playoffs and the final people who thought hockey was dead in chi-town started buying up product once again. Canucks, another one I'm not to sure of as to why..These are my theories anyway

That's not the part I'm confused by. I know why those teams make the bulk of the cash, it's a no brainer. Huge hockey fanbases, playoff success, big market teams, high priced tickets, etc. The part I'm trying to figure out is how did 23 teams essentially lose more money than 7 teams made.

 

[jstewismybastardson]

Canucks, another one I'm not to sure of as to why

its a gate driven league ... look at average ticket prices ... canucks apparently had the 3rd highest ticket price last year ... plus they made the playoffs which is basically $1.5 million of profit for every home game night

 

[jstewismybastardson]

The part I'm trying to figure out is how did 23 teams essentially lose more money than 7 teams made.

Im confused by your question

7 teams had cumulative income of 240.8 mill

the other 23 teams cumulatively lost 80.8 mill

total league profit 160 mill

 

[Eddie_Shack]

Im confused by your question

7 teams had cumulative income of 240.8 mill

the other 23 teams cumulatively lost 80.8 mill

total league profit 160 mill

I guess I don't have a question, it just blows my mind.

 

[dash]

The NHL marketing and revenue plan:

Step 1: 30 NHL teams
Step 2: ???
Step 3: Profit

 

[pixburgher66]

How the heck were the Caps in the red?? (No pun intended) Or Buffalo for that matter.

 

[jstewismybastardson]

How the heck were the Caps in the red?? (No pun intended) Or Buffalo for that matter.

Ill point to average nhl ticket price again

both teams are in the bottom 10 ... I think Buffalo had the 3rd lowest ticket price last year

 

[dash]

Ill point to average nhl ticket price again

both teams are in the bottom 10 ... I think Buffalo had the 3rd lowest ticket price last year

You know it's sad that I think the only way to get changes to Flames mgmt is for the fans to stop going to games - Of course, with a 97% renewal rate on season tickets this season, looks like Flames fans will have to wait a little while longer.

 

[puckhead]

Canucks, another one I'm not to sure of as to why..These are my theories anyway

as jstew mentioned we have expensive tickets,
we also have a long waiting list for season tickets,
a sell out streak of several hundred games (2nd longest in the league, i believe),
have averaged 2 rounds in the playoffs (ticket price boost AND players don't get paid)
and sell a hell of a lot of sweaters around the league

also, we seem to switch jerseys every couple of years, so the die-hards have to keep up.

 

[mattola]

also, we seem to switch jerseys every couple of years, so the die-hards have to keep up.

I have 14

 

[TheRobotDevil]

Was actually reading something about the yesterday.believe it said the devils made a profit but dropped in value.if those numbers are based on last year the devils better hope for a miracle or I would expect an even bigger dip in value next year.

 

[dash]

You have to take the Forbes numbers with a grain of salt, but as I said yesterday, the Oil and Flames need each other and even when you total their numbers, they would come in 4th in the league.

 

[jstewismybastardson]

Was actually reading something about the yesterday.believe it said the devils made a profit but dropped in value.if those numbers are based on last year the devils better hope for a miracle or I would expect an even bigger dip in value next year.

check out that Debt/Value ratio ... yikes!!!

 

[HonusWagner66]

16 teams were in the red

 

[sabresfaninthesouth]

Was actually reading something about the yesterday.believe it said the devils made a profit but dropped in value.if those numbers are based on last year the devils better hope for a miracle or I would expect an even bigger dip in value next year.

The Devs are gonna drop for each of the next few years most likely.

Figure in declining attendance - assuming it drops because a) they suck this year and b) the novelty of a new arena wears off more and more over time - plus the decline in value of the arena as it ages (also see point b).

 

[sabresfaninthesouth]

I was honestly most surprised that the Pens were in the red. Granted, the Igloo wasn't helping them, but considering they were coming off of two amazing years - SCF and SC Champions - and another two round post-season, I'm really amazed that they didn't post a profit.

As for the Sabres, ticket prices are definitely part of it, but there was a certain distant feeling that the fans had last year, despite the success of the team, which almost certainly affected merchandise sales and such.

 

[TheRobotDevil]

Can't say I can argue with your points sabresfan .having gone to several devs games they,ve had attendance issues stemming before their drop in play.only tinks I've seen the building full are retro jersey night and big games.new arenas fine actually preferred the old one.can't tailgate in Newark but like you said you don't go to a game for the arena.

 

[HonusWagner66]

I was honestly most surprised that the Pens were in the red. Granted, the Igloo wasn't helping them, but considering they were coming off of two amazing years - SCF and SC Champions - and another two round post-season, I'm really amazed that they didn't post a profit.

As for the Sabres, ticket prices are definitely part of it, but there was a certain distant feeling that the fans had last year, despite the success of the team, which almost certainly affected merchandise sales and such.

Pens just opened a new arena this year. I bet that has something to do with it.