Packers show super bottom line
The Packers are reporting a $12 million profit from operations for 2010-2011, up $2.2 million from the previous year. The overall net income was $17.1 million—a jump of nearly $12 million over last year, due in large part to improved performance by investments.
And while team officials still have some concerns about the lingering effects of the lockout, which has hurt their ability to sell sponsorships going into the season, the Packers are emerging from all the uncertainty on solid financial footing.
“It appears that the Super Bowl trumps the lockout,” Packers president and CEO Mark Murphy said.
As the league’s only publicly owned franchise, the Packers are the only NFL team required to reveal detailed financial data. Results will be announced during Thursday’s shareholders meeting at Lambeau Field but the team provided an advance look to media outlets, including The Associated Press.
The Packers’ total revenue was $282.6 million. Murphy said the Packers should rank among the top 15 teams in the league in terms of gross revenues.
The Packers’ financial report was a significant point of contention a year ago, as players were clamoring for other teams to open their books. But now that players and owners have agreed to a new deal, the numbers won’t be as heavily scrutinized.
“I think there was compromise on both sides,” Murphy said. “We feel we made some economic gains, really to address some of the concerns that we’ve seen with our financial statements, really over the last five years. We’ve seen over the last couple years some of the concerns in terms of player costs increasing at a higher rate than revenue.”
In turn, Murphy said the players made “significant gains” in terms of health and safety.
And with a decade of labor peace on the horizon and new incentives for NFL teams to grow their local revenue, the Packers intend to move forward on expanding the seating capacity at Lambeau Field.
Under the new agreement, owners share 40 percent of local revenues with the players—a lower percentage than they will share of national television revenues or other national ventures. And the new agreement contains provisions that will reimburse some of the money teams spend on stadium improvements.
“Half of the private investment that a team makes, they can get back through stadium credits,” Murphy said.
No timeline or budget estimate is in place for the expansion, which could add about 7,000-plus seats to the south end zone.
“The demand for tickets has maintained, and even increased, during the lockout,” Packers vice president of administration/general counsel Jason Wied said. “It gives us a lot of confidence that we could add additional seats here. And it’s important to recognize that the Packers are in a different position than the rest of the league. Although we didn’t see a lot of direct impacts because of the lockout, on our financials, that’s not the case across the league.”
The team froze, but did not cut, employees’ salaries during the lockout. The Packers also had a hiring freeze. The franchise didn’t have to dip into its “preservation fund,” which remains unchanged at $127.5 million.
Murphy said the $2.2 million increase in profit from operations came mostly from the Lambeau Field atrium area attractions and the team’s Pro Shop, as fans snapped up additional souvenirs during and after the team’s Super Bowl run. The Packers’ local revenue jumped nearly $19 million.
“We’ve seen a pretty good spike,” Murphy said. “That’s something that we were very pleased with.”
The spike would have been bigger, however, if the Packers had played some of their playoff games at home. Officials estimate that a home playoff game adds close to $1 million to a team’s bottom line.
And while player costs decreased about $2 million from the previous year, Packers officials noted that they weren’t allowed to negotiate any new player contracts during the lockout. Had they been able to do so, player costs likely would not have fallen.
“In a lot of ways, it was really artificial,” Murphy said. “Because of the labor situation, and the lockout, we really lost the month of March. Normally, March is a month where we’ll extend a number of players to long-term contracts. Really, with the labor situation, we didn’t have that capability.”
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