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2012 CBA & Re-alignment: Lockout in Effect. Thanks Gary/Donald! PART II

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Old
11-16-2012, 09:52 PM
  #751
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Hey folks - I couldn't get the Auditor's Report to open on my Mac today. Will try on a PC tomorrow and attempt to translate for everyone as they can be a ***** to understand and explain to others. Hopefully there will be a year to year ledger providing more in-depth data in the report.

I am most curious about the point Wes mentioned regarding potentially much higher profits from hockey games over concerts for instance.

However keep in mind that this facility apparently has some stiff competition for shows in it's market, potentially driving down revenues from concerts and the like.

There is also the possibility they could have lost significant revenue from cancelations due to weather in 04/05, as that was a bad period for Hurricanes in the region. Can someone interested in the details maybe try to Google it? In particular, was the facility damaged and out of operation for a time?

Excited to actually have some real data to work with for once on understanding the economics of the Lockout!


Last edited by Gallatin: 11-16-2012 at 09:58 PM.
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11-17-2012, 02:27 AM
  #752
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Quote:
Originally Posted by Shady Machine View Post
Bettman suggests 2 week break on negotiation talks:

http://www.tsn.ca/nhl/story/?id=409553

I don't know who came up with this idea from the owners side, but it is absolutely brilliant. I strongly suspect that this will be seen as the turning point in these negotiations, just give it a little time to play out.

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11-17-2012, 07:52 AM
  #753
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I don't know who came up with this idea from the owners side, but it is absolutely brilliant. I strongly suspect that this will be seen as the turning point in these negotiations, just give it a little time to play out.
I dunno Jon, how stupid does Bettman have to be, to not think this gets leaked to the press by the PA?

It reeks of desperation and is the mark of a poor leader who is out of ideas to fulfill his promise to the owners of "big gains" on contracts and revenue division:

http://mobile.philly.com/sports/?wss...viewAll=y#more

One thing new I learned from this article that I completely forgot about, is that Bettman only needs 7 votes if he wants veto power, since Phoenix is owned by the league. Even more power in the hands of the man who has no concern for the integrity of the league.

The only positive is that the article states Snider and the Pens realize Bettman is making a mockery of their sport and both teams are making a push to get this deal done, before any further damage is done.

Quote:
Despite their on-ice rivalry, there seems to be some thinking that the Flyers are interested in teaming up with the midmarket but high-revenue Pittsburgh Penguins to sway more governors toward a swift resolution. The Rangers are also viewed as anti-lockout.


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11-17-2012, 10:26 AM
  #754
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Originally Posted by Wes C Addle View Post
I think one of the main arguments was this section of the article



If I'm understanding the article correctly, during the lockout season, they had their worst financial year. Which, I believe the author is suggesting is curious if the assumption is that hockey is not profitable. That aspect seems to contradict itself.
It is confusing from that wording but it almost seems to suggest that because there was a bad year the year of the lockout that it means the arena deal is not the profitable aspect of why the Panthers were making some small profits over a 14 year period?

If that's the case it naively assumes there are absolutely no hockey costs during that locked out season. I am sure the Panthers still had people they had to pay, or other various expenses that don't magically disappear during a locked out season. All the owner right now are shelling out some sort of expenses and they're not taking in any revenue unless they have a sweetheart arena deal to subsidize their team.

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11-17-2012, 02:50 PM
  #755
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Originally Posted by Jonjmc View Post
I don't know who came up with this idea from the owners side, but it is absolutely brilliant. I strongly suspect that this will be seen as the turning point in these negotiations, just give it a little time to play out.
Yeah I agree. I love all the people call him an idiot or poor leaders. The owners of the NHL obviously disagree or he wouldn't have held his position for so long.

To the NHLPA Kool-Aid drinkers, how smart are the NHLPA if they are about to lose an entire season's worth of pay? Their bodies are a finite commodity and this is money lost forever so how can their stances make any sense what so ever to you?

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11-17-2012, 03:15 PM
  #756
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Originally Posted by Mr Jiggyfly View Post
I dunno Jon, how stupid does Bettman have to be, to not think this gets leaked to the press by the PA?

It reeks of desperation and is the mark of a poor leader who is out of ideas to fulfill his promise to the owners of "big gains" on contracts and revenue division:

http://mobile.philly.com/sports/?wss...viewAll=y#more

One thing new I learned from this article that I completely forgot about, is that Bettman only needs 7 votes if he wants veto power, since Phoenix is owned by the league. Even more power in the hands of the man who has no concern for the integrity of the league.

The only positive is that the article states Snider and the Pens realize Bettman is making a mockery of their sport and both teams are making a push to get this deal done, before any further damage is done.
the bolded is hyperbole. no where in that article does it say the penguins have any problem with bettman.

this whole article is weird. it also mentions bill clinton getting involved... what the heck?

as of last week, the only two teams that were anti-lockout were montreal and vancouver.

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11-17-2012, 03:19 PM
  #757
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The Bettman proposed moratorium is probably going to be the swing point if a deal is made.

Once he said it, the NHLPA could of done nothing and blamed Bettman for not wanting to have any last ditch negotiations, but practically immediately afterwards, the NHLPA contacts the NHL and tells them they want to met, realizing that if they don't get something done in the next couple of weeks, the season is over.

The moratorium was a perfect gambit at the current stage of things. It pretty much put a line in the sand for when a deal needed to be done or there would be be an upcoming cancelled season soon afterwards. Its sucks that it came to this point but I had no problem with the strategy when it was made since it gave a clear season tipping point to all involved. All the talks over the past months hadn't produced much of anything and a drop-dead date was necessary to get **** moving to the end goal. Everybody was talking about the cancelled season possibility for months but now that we are entering late November, it's not a far off boogeyman or a fake threat, it's here and things need to get hashed out by early Dec. at the absolutely latest or there will be no season. I think both sides are finally really feeling the crunch for the first time.

This is the first time I've felt any optimism for a season for a good while.


Last edited by Sivek: 11-17-2012 at 03:28 PM.
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11-17-2012, 03:24 PM
  #758
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http://flyers.nhl.com/club/news.htm?id=645860

Snider states that the report i false. I'd take both the article and Sniders statement with a grain of sand to be honest.

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11-17-2012, 03:31 PM
  #759
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Sort of interesting

http://prohockeytalk.nbcsports.com/2...nference-call/

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11-17-2012, 04:59 PM
  #760
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It takes 75% of owners to override Bettman in the CBA negotiations; I wonder if it takes the same number to fire him.

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11-17-2012, 05:06 PM
  #761
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Quote:
Originally Posted by Til the End of Time View Post
the bolded is hyperbole. no where in that article does it say the penguins have any problem with bettman.

this whole article is weird. it also mentions bill clinton getting involved... what the heck?

as of last week, the only two teams that were anti-lockout were montreal and vancouver.
Smart money says that there is a cute intern involved.

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11-17-2012, 05:27 PM
  #762
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It takes 75% of owners to override Bettman in the CBA negotiations; I wonder if it takes the same number to fire him.
If the owners went against Bettman he would take this as his hint to retire from the job.

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11-17-2012, 05:52 PM
  #763
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Originally Posted by IanMoranFanclub View Post
It takes 75% of owners to override Bettman in the CBA negotiations; I wonder if it takes the same number to fire him.
No, simple majority vote. I would think that the Phoenix vote would be an abstention, so all it takes is 15. And in case anyone is wondering, no chance in hell that happens.

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11-17-2012, 05:59 PM
  #764
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I just finished my review of the Florida Panthers Arena Operations Auditor's Report for the years 1999-2008.

The parent company is Sunrise Sports & Entertainment Ltd. (SSE) and the sister corporations under that company are the Arena Operating Company Ltd. (AOC), and Florida Panthers Hockey Club Ltd. (FPHC). There was no information on whether SSE owned any other subsidiary corporations.

It was actually not too bad of a read, these guys did not go into nearly as much detail as I am used to with the Auditor's Reports for the businesses I have operated. I am running late to get to the Pitt basketball game though, so I will keep this short, and answer any questions folks may have in the next few days.

Miami is considered a strong entertainment market. When this very large Arena opened in 1999 there was a lack of Miami area facility competition for shows, and the Panthers were coming off a streak of several years good play that included a run to the finals. It holds 19k+ for 41+ hockey games, and 22k+ for 70-100 shows per year.

The first 3 years of 1999, 2000, 2001, they absolutely crushed it on pre-tax net profit, averaging well over $13 million per season. In 2002 another Miami area facility opened, driving increased competition that severely impacted pre-tax net, practically cutting it in half. Then the Lockout came in 2004/2005, damaging pre-tax net again.

They had a nice rebound in 2006 to $11.7 million, but pre-tax net was consistently eroded the next few years, to the point that in 2009 at the time this report was written, the Panthers sister corp owed the county more than $8 million, and there was concern that AOC did not have enough cash in the bank to meet it's debt service obligations for their part of Arena development costs.

If FPHC did indeed average 7.5 million in losses from 2002 through 2008, AOC pre-tax net profit has not covered all of those loses, and they are 3 to 4 million in the red for the period 2002 through 2008 if you add the two subsidiary corporations together.

The significant downward trend in pre-tax net profit from 2006 to 2008 leads me to believe that it possible combined losses for the sister subsidiary corporations owned by SSE have grown at an increasingly steep rate the last 3 years, as AOC pre-tax net profit is assumed to continue to erode, and FPHC's net losses are assumed to have increased in recent years. Knowing what I know of the industry, I would not be surprised to find out the combined losses of AOC and FPHC have grown to over 5 million a year recently.

Well there you have it folks. Some real data, some assumptions on my part, and an interesting look at the relationship between Arena and Hockey Team. Make of it what you wish and I will check in the next day or two to answer any questions that may be posted. Wow am I late for the game!


Last edited by Gallatin: 11-18-2012 at 11:26 AM.
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11-17-2012, 06:05 PM
  #765
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No, simple majority vote. I would think that the Phoenix vote would be an abstention, so all it takes is 15. And in case anyone is wondering, no chance in hell that happens.
Right, but my point is that Bettman's not going to hold 20 owners hostage to appease the other 9 just because he can. If a majority of the owners direct Bettman to make a deal, that's what he's going to do because they would not hesitate to fire him and hire some other crony in his place.

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11-18-2012, 02:50 PM
  #766
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Gallatin: curious what general conclusions you can draw from this in terms of how "struggling owners" might still make a lot of money, not have much of a leg to stand on in terms of "we need to change the CBA to save the game" BS. Although I think we all agree the back-diving contracts aren't good for anyone.

Unrelated: if the season is kaput... what happens at the draft? Does everyone get an equal number of ping-pong balls in the lotto machine / an equal shot at getting lottery picks? If we could get MacKinnon or Drouin that would be hilarious (and slightly awesome). The anti-Penguin pandemonium would be unprecedented. I for one will enjoy some serious post deletion and infracting of angry fans within the division. "It's rigged! I'm never watching hockey again. F all you !*&^!*&!"

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11-18-2012, 05:14 PM
  #767
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[QUOTE=Chancellor Vitale;55858317]Gallatin: curious what general conclusions you can draw from this in terms of how "struggling owners" might still make a lot of money, not have much of a leg to stand on in terms of "we need to change the CBA to save the game" BS. Although I think we all agree the back-diving contracts aren't good for anyone.

Well any conclusions I would draw from this single data point would probably not have much validity, as I would need at least one other team's Auditor's Report to start a baseline.

With that said, I am struck by the fact that combined the hockey team & arena have been losing money in South Florida, and those losses seem to have excellerated.

So my hypothesis would be something along the lines of; Many NHL teams which also operate arena's and are assumed to be losing money are pobably netting a few million a year afterall. But they are not making bank.

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11-18-2012, 06:03 PM
  #768
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Quote:
Originally Posted by Chancellor Vitale View Post
Gallatin: curious what general conclusions you can draw from this in terms of how "struggling owners" might still make a lot of money, not have much of a leg to stand on in terms of "we need to change the CBA to save the game" BS. Although I think we all agree the back-diving contracts aren't good for anyone.

Unrelated: if the season is kaput... what happens at the draft? Does everyone get an equal number of ping-pong balls in the lotto machine / an equal shot at getting lottery picks? If we could get MacKinnon or Drouin that would be hilarious (and slightly awesome). The anti-Penguin pandemonium would be unprecedented. I for one will enjoy some serious post deletion and infracting of angry fans within the division. "It's rigged! I'm never watching hockey again. F all you !*&^!*&!"
Just went to the lottery thread on the prospect board. Some Wings fan thinks the Pens (and Hawks) tanked. Go figure.

But yeah, the anti-Penguins group would be livid. I think part of that attention will be shifted to the Oilers in a few years. Once they, ya know... start winning games.

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11-18-2012, 06:26 PM
  #769
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Quote:
Originally Posted by Gallatin View Post
I just finished my review of the Florida Panthers Arena Operations Auditor's Report for the years 1999-2008.

The parent company is Sunrise Sports & Entertainment Ltd. (SSE) and the sister corporations under that company are the Arena Operating Company Ltd. (AOC), and Florida Panthers Hockey Club Ltd. (FPHC). There was no information on whether SSE owned any other subsidiary corporations.

It was actually not too bad of a read, these guys did not go into nearly as much detail as I am used to with the Auditor's Reports for the businesses I have operated. I am running late to get to the Pitt basketball game though, so I will keep this short, and answer any questions folks may have in the next few days.

Miami is considered a strong entertainment market. When this very large Arena opened in 1999 there was a lack of Miami area facility competition for shows, and the Panthers were coming off a streak of several years good play that included a run to the finals. It holds 19k+ for 41+ hockey games, and 22k+ for 70-100 shows per year.

The first 3 years of 1999, 2000, 2001, they absolutely crushed it on pre-tax net profit, averaging well over $13 million per season. In 2002 another Miami area facility opened, driving increased competition that severely impacted pre-tax net, practically cutting it in half. Then the Lockout came in 2004/2005, damaging pre-tax net again.

They had a nice rebound in 2006 to $11.7 million, but pre-tax net was consistently eroded the next few years, to the point that in 2009 at the time this report was written, the Panthers sister corp owed the county more than $8 million, and there was concern that AOC did not have enough cash in the bank to meet it's debt service obligations for their part of Arena development costs.

If FPHC did indeed average 7.5 million in losses from 2002 through 2008, AOC pre-tax net profit has not covered all of those loses, and they are 3 to 4 million in the red for the period 2002 through 2008 if you add the two subsidiary corporations together.

The significant downward trend in pre-tax net profit from 2006 to 2008 leads me to believe that it possible combined losses for the sister subsidiary corporations owned by SSE have grown at an increasingly steep rate the last 3 years, as AOC pre-tax net profit is assumed to continue to erode, and FPHC's net losses are assumed to have increased in recent years. Knowing what I know of the industry, I would not be surprised to find out the combined losses of AOC and FPHC have grown to over 5 million a year recently.

Well there you have it folks. Some real data, some assumptions on my part, and an interesting look at the relationship between Arena and Hockey Team. Make of it what you wish and I will check in the next day or two to answer any questions that may be posted. Wow am I late for the game!
Thanks for the sum up Gallatin, excellent stuff! Hope you made it to the game and stayed for the finish, heck of a show that was.

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11-19-2012, 12:48 PM
  #770
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Thanks for the sum up Gallatin, excellent stuff! Hope you made it to the game and stayed for the finish, heck of a show that was.
Man that game was something else Wes. I am getting very excited about the basketball program. This the first time I can remember having 3 legit scorers (Tray, Talib, JJ) on the team, along with high upside complimentary players in JRob & Adams.

And I think Durand is going to flourish coming off the bench.

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11-19-2012, 06:16 PM
  #771
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Labor negotiations have nothing to do with right and wrong. They have to do with leverage. The further this goes on the more leverage the NHLPA loses. You can see quotes by several players already that they are cracking as expected.

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11-19-2012, 06:59 PM
  #772
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Labor negotiations have nothing to do with right and wrong. They have to do with leverage. The further this goes on the more leverage the NHLPA loses. You can see quotes by several players already that they are cracking as expected.
Probably too late to save a season though.

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11-19-2012, 07:48 PM
  #773
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Probably too late to save a season though.
If they don't get something done in the next week I predict they'll call it. If they do get something done we're probably looking at 50 games more or less. So it's 50 or nothing, basically.

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11-19-2012, 09:45 PM
  #774
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If they don't get something done in the next week I predict they'll call it. If they do get something done we're probably looking at 50 games more or less. So it's 50 or nothing, basically.
I'm not holding my breath.

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11-20-2012, 04:26 AM
  #775
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Quote:
Originally Posted by Chancellor Vitale View Post
Gallatin: curious what general conclusions you can draw from this in terms of how "struggling owners" might still make a lot of money, not have much of a leg to stand on in terms of "we need to change the CBA to save the game" BS. Although I think we all agree the back-diving contracts aren't good for anyone.

Unrelated: if the season is kaput... what happens at the draft? Does everyone get an equal number of ping-pong balls in the lotto machine / an equal shot at getting lottery picks? If we could get MacKinnon or Drouin that would be hilarious (and slightly awesome). The anti-Penguin pandemonium would be unprecedented. I for one will enjoy some serious post deletion and infracting of angry fans within the division. "It's rigged! I'm never watching hockey again. F all you !*&^!*&!"
I guess it would work just like last time. The more points and playoff appearances a teams had in the last 3 years, the smaller the chance for a good pick becomes. But technically, I think every team has a chance at 1st overall, even if it's only 1% or whatever unlike in a regular draft.

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