Forbes claims the Pirates made over $20M last season

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Forbes claims the Pirates made over $20M last season

Postby Draftnik on Sun Apr 23, 2006 12:39 pm

http://www.forbes.com/lists/2006/33/Revenues_1.html

I'm not a big fan of their Sports studies because it is difficult to believe they can get information with much granularity on private enterprises. On the other hand, Jason Stark of ESPN has said low revenue teams are guaranteed well over $50M from MLB before they even rake in a single penny of local revenue, so the notion that the Pirates are very profitable is not hard to believe with their low payroll.

http://www.forbes.com/2006/04/17/06mlb_baseball-team-valuations-cx_mo_0420sports.html

This season's payroll seems to be an anomaly for the Pirates with the one time boost in revenues from the All Star game. In spite of that attraction I noticed their attendance was around 28th in MLB. They really run the risk of further alienating their already deteriorated fan base if they can't turn their season around to at least respectability. What will they have left to sell once the All Star game passes? Scenic views, cold beer, tasty junk food, fireworks, etc.
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Re: Forbes claims the Pirates made over $20M last season

Postby Tomas on Sun Apr 23, 2006 6:04 pm

Draftnik wrote:http://www.forbes.com/lists/2006/33/Revenues_1.html

I'm not a big fan of their Sports studies because it is difficult to believe they can get information with much granularity on private enterprises. On the other hand, Jason Stark of ESPN has said low revenue teams are guaranteed well over $50M from MLB before they even rake in a single penny of local revenue, so the notion that the Pirates are very profitable is not hard to believe with their low payroll.

http://www.forbes.com/2006/04/17/06mlb_baseball-team-valuations-cx_mo_0420sports.html

This season's payroll seems to be an anomaly for the Pirates with the one time boost in revenues from the All Star game. In spite of that attraction I noticed their attendance was around 28th in MLB. They really run the risk of further alienating their already deteriorated fan base if they can't turn their season around to at least respectability. What will they have left to sell once the All Star game passes? Scenic views, cold beer, tasty junk food, fireworks, etc.


Both of the links you listed lead to MLB numbers, so I was not able to see what the $20 mil. figure refers to.
However, if it was sales revenues, then it is nothing to write home about.
The average gate receipts alone were $18.6 million *in the 1990's*. (see Table 2 below)

http://comp.uark.edu/~tjandik/papers/hockeyarenas.pdf
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Postby Draftnik on Sun Apr 23, 2006 8:51 pm

Baseball Team Valuations

Rank Team Current Value1 ($mil) 1-Yr Value Change (%) Debt/Value2 (%) Revenues ($mil) Operating Income3 ($mil)
1 New York Yankees 1026 8 12 277 -50.0
2 Boston Red Sox 617 10 39 206 -18.5
3 New York Mets 604 20 42 195 -16.1
4 Los Angeles Dodgers 482 14 87 189 13.4
5 Chicago Cubs 448 12 0 179 7.9
8 Seattle Mariners 428 3 23 179 7.3
9 Philadelphia Phillies 424 8 42 176 14.8
10 Houston Astros 416 17 13 173 30.2
12 Atlanta Braves 405 6 7 172 27.6
11 San Francisco Giants 410 8 37 171 11.2
13 Los Angeles Angels of Anaheim 368 25 10 167 -2.6
7 St Louis Cardinals 429 16 47 165 7.9
15 San Diego Padres 354 8 56 158 13.0
18 Chicago White Sox 315 20 11 157 21.7
14 Baltimore Orioles 359 5 42 156 21.0
16 Texas Rangers 353 8 45 153 24.7
17 Cleveland Indians 352 10 28 150 34.6
21 Detroit Tigers 292 22 73 146 3.5
6 Washington Nationals 440 42 27 145 27.9
19 Arizona Diamondbacks 305 7 79 145 21.8
20 Colorado Rockies 298 3 30 145 16.3
23 Cincinnati Reds 274 8 15 137 17.9
22 Toronto Blue Jays 286 34 0 136 29.7
27 Oakland Athletics 234 26 38 134 16.0
26 Milwaukee Brewers 235 13 51 131 22.4
24 Pittsburgh Pirates 250 15 44 125 21.9
28 Florida Marlins 226 10 31 119 -11.9
25 Kansas City Royals 239 28 15 117 20.8
30 Tampa Bay Devil Rays 209 19 17 116 20.3
29 Minnesota Twins 216 21 42 114 7.0




Revenues and operating income are for 2005 season.
1Value of team based on current stadium deal (unless new stadium is pending) without deduction for debt (other than stadium debt).
2Includes stadium debt.
3Earnings before interest, taxes, depreciation and amortization.
NA: Not applicable.
Team Logos Courtesy MLB.



http://www.forbes.com/lists/2006/33/Revenues_1.html

Forbes estimated the Pirates EBITDA at $21.9M last season. Their revenues were estimated at $125M. I think all MLB teams get over $50M from the general MLB fund then teams like the Pirates get another ~ $20M from the revenue sharing fund. They already have ~ $70M before they sell a ticket or get rights fees from their RSN. Their payroll was ~ $35M so they should easily be profitable. They only paid ~ $45M for PNC Park, so unless they financed 100% of the team purchase at a high interest rate (unlikely considering they could have refinanced to a very low rate in the early 2000s) they should have posted very healthy net profits the past few seasons.
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Postby Tomas on Mon Apr 24, 2006 12:37 pm

Sorry, I don't know how to read, apparently. I see now that the title of the post said "Pirates." I thought it was "Penguins."...
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Postby Bowser on Mon Apr 24, 2006 12:50 pm

The Pirates are expected to make $30-45 million in profits for 2006. Bud Selig better prepare the small market hacks in KC, Pittsburgh, Miami and Tampa with revenue-sharing cutbacks because Yankees, Mets,and Red Sox are preparing to reduce their welfare handouts with new stadiums or park updates.

I reported it last year and I'll repeat it again, McClatchy's contract as CEO expires after the 2006 season and Nutting's are likely to extend the deal until the CBA is finalized this winter.

Afterwards, Robert Nutting will take over as CEO until the team is sold.

The Nuttings know their profits are about to hit a major block because of the large markets fixing/building stadiums and those big owners have also threatened to vetoe any CBA that doesn't force small market teams to spend their revenue-sharing money on player payroll.

I'm hoping for the large market owners to criticize McClatchy for failing this region and sending a poor product onto the field at PNC Park.

I can't wait for the All-Star break and what is announced afterwards.
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