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The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, expansion and relocation, and NHL revenues.

Forbes 2007 franchise values

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Old
11-08-2007, 07:53 PM
  #1
LadyStanley
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Forbes 2007 franchise values

http://www.forbes.com/home/business/...8nhl_land.html

Maple Leafs top the chart at more than $400m. Predators at the bottom.

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Old
11-08-2007, 08:37 PM
  #2
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Just don't agree with those numbers from the Oilers perspective

DEBT RANK

http://www.forbes.com/lists/2007/31/...tions_DOV.html

VALUE CHANGE

http://www.forbes.com/lists/2007/31/..._YrChange.html
*NJ had the biggest increase - likely tied to their new arena

REVENUE
http://www.forbes.com/lists/2007/31/...s_Revenue.html

*18th in the league according to Forbes, which directly contradicts statements by Nichols, LaForge, and Lowe indicating top 10 in league revenues. The Oilers paid into revenue sharing both years, so they had to be top 10.

Cal Nichols indicating the Oilers are 7th in league revenues

http://hfboards.com/showthread.php?t=402791

Further contradiction:
"Our gross revenues have exceeded $80 million. Now, if we cannot run a hockey team of 23 players, there's something drastically wrong here."
(Edmonton Oilers chairman Cal Nichols, Toronto Sun, October 12, 2003)

Yet, apparently the Oilers revenues fell by 10-15M since 2003, despite a much higher dollar, and 25-30% increase in ticket prices along with luxury suites doubling in prices?


OPERATING INCOME
http://www.forbes.com/lists/2007/31/...ns_Income.html

How is it possible to be 18th in league revenues, and 8th in overall profit, despite the fact the team was bottom third in payroll?

Just more contradictions, leading me to believe Forbes.com didn't actually look at the books, but just making raw estimates.

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11-08-2007, 08:42 PM
  #3
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I can't speak for all Leaf fans, but this is wayyy more gratifying than a Stanley Cup.




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Old
11-08-2007, 09:01 PM
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I will be very interested in seeing these numbers next year, to compare the Devils revenue in the old arena and new arena.

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11-08-2007, 09:42 PM
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interesting

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Old
11-08-2007, 11:47 PM
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Quote:
Originally Posted by PunjabiOil View Post
DEBT RANK

http://www.forbes.com/lists/2007/31/...tions_DOV.html

VALUE CHANGE

http://www.forbes.com/lists/2007/31/..._YrChange.html
*NJ had the biggest increase - likely tied to their new arena

REVENUE
http://www.forbes.com/lists/2007/31/...s_Revenue.html

*18th in the league according to Forbes, which directly contradicts statements by Nichols, LaForge, and Lowe indicating top 10 in league revenues. The Oilers paid into revenue sharing both years, so they had to be top 10.

Cal Nichols indicating the Oilers are 7th in league revenues

http://hfboards.com/showthread.php?t=402791

Further contradiction:
"Our gross revenues have exceeded $80 million. Now, if we cannot run a hockey team of 23 players, there's something drastically wrong here."
(Edmonton Oilers chairman Cal Nichols, Toronto Sun, October 12, 2003)

Yet, apparently the Oilers revenues fell by 10-15M since 2003, despite a much higher dollar, and 25-30% increase in ticket prices along with luxury suites doubling in prices?


OPERATING INCOME
http://www.forbes.com/lists/2007/31/...ns_Income.html

How is it possible to be 18th in league revenues, and 8th in overall profit, despite the fact the team was bottom third in payroll?

Just more contradictions, leading me to believe Forbes.com didn't actually look at the books, but just making raw estimates.
I don't believe the Forbes revenue figures for HRR are very accurate. I would like to see their methodology and would like to know if they reviewed and incorporated the leaked NHL data from last year presented by the G&M. My guess is they are punching in NHL attendance figures with the team marketing report or other questionable data and making other dubious assumptions as they have done in the past.

A lot of these mainstream US financial magazines/rags have a terrible record. If you have ever invested in their stocks/equities picks on the US financial markets based on their advice/analysis, I wish you very well, indeed.

GHOST

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Old
11-09-2007, 02:45 AM
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Forbes does this analysis without looking at any books for teams. I'm not sure what the point is, to be honest. The report is consistently wrong and every year it gets ripped to shreds on this board, among others.

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Old
11-09-2007, 11:12 AM
  #8
mouser
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Quote:
Originally Posted by PunjabiOil View Post
REVENUE
http://www.forbes.com/lists/2007/31/...s_Revenue.html

*18th in the league according to Forbes, which directly contradicts statements by Nichols, LaForge, and Lowe indicating top 10 in league revenues. The Oilers paid into revenue sharing both years, so they had to be top 10.

Cal Nichols indicating the Oilers are 7th in league revenues
Forbes revenue != League revenue. League revenue does not include multiple items such as luxury boxes. Forbes (attempts to) include all revenue associated with owning/operating the franchise which for some teams could even include things like operating the arena for non-hockey events. Many other franchises have significantly more "non-League revenue" than the Oil.


Quote:
Originally Posted by PunjabiOil View Post
http://hfboards.com/showthread.php?t=402791

Further contradiction:
"Our gross revenues have exceeded $80 million. Now, if we cannot run a hockey team of 23 players, there's something drastically wrong here."
(Edmonton Oilers chairman Cal Nichols, Toronto Sun, October 12, 2003)

Yet, apparently the Oilers revenues fell by 10-15M since 2003, despite a much higher dollar, and 25-30% increase in ticket prices along with luxury suites doubling in prices?
You're making an error here leaving out the exchange rate. $80mil in 02-03 translated to roughly $53mil USD. Forbes valuation report for the 02-03 season listed Edmonton at $48mil USD revenue, so they're at least in the ballpark.

Nichols quote after the lockout indicating the Oilers revenue was expected to drop:
Quote:
Nichols acknowledged that revenues league-wide are projected to fall to $1.74 billion from $2.1 billion US in 2003-04. He reckoned the Oilers, who pulled in about $85 million Cdn in gross revenues the last NHL season, will derive something closer to $70 million in 2005-06.

Some sponsors have fallen away, or committed funds elsewhere, at least for this year, Nichols explained. And the small-market equalization fund that delivered about $2.5 million to the Oilers most years does not exist under the new CBA.

Quote:
Originally Posted by PunjabiOil View Post
OPERATING INCOME
http://www.forbes.com/lists/2007/31/...ns_Income.html

How is it possible to be 18th in league revenues, and 8th in overall profit, despite the fact the team was bottom third in payroll?

Just more contradictions, leading me to believe Forbes.com didn't actually look at the books, but just making raw estimates.
It's all about your operating expenses, and being below average in payroll is a positive contributor to profitability. Also the Oil are among the lowest in debt % meaning less of their revenue goes towards servicing that debt.

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Old
11-09-2007, 12:12 PM
  #9
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Quote:
Originally Posted by mouser View Post

Nichols quote after the lockout indicating the Oilers revenue was expected to drop:
But since then, I'm sure they got all the sponsorship back, and they raised ticket prices a good 30% since 2005-2006. That isn't reflected on forbes.com

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Old
11-09-2007, 12:12 PM
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Quote:
Originally Posted by mouser View Post
Nichols quote after the lockout indicating the Oilers revenue was expected to drop:
It is absolutely and completely improbable that the Oilers revenue would decrease after the lockout.
Not only has the Canadian dollar increased substantially, they have had a huge increase in ticket prices and are benefitting from a boom in the Alberta economy in the last few year.

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Old
11-09-2007, 02:51 PM
  #11
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Quote:
Originally Posted by PunjabiOil View Post
But since then, I'm sure they got all the sponsorship back, and they raised ticket prices a good 30% since 2005-2006. That isn't reflected on forbes.com
1) Any reference for "I'm sure they got all the sponsorship back"?

2) Exactly how are you determining Forbes isn't reflecting the raised ticket prices?

Forbes revenue #'s for the Oilers in USD:
01-02: $43mil (approx $68mil CDN)
02-03: $48mil (approx $73mil CDN)
03-04: $55mil (approx $73mil CDN)
05-06: $75mil (approx $88mil CDN)
06-07: $71mil (approx $84mil CDN)

And before you tell me "they must have made more $ in 06-07 because they raised ticket prices", exactly how much playoff revenue did the Oilers generate in 06-07 versus 05-06?


Quote:
Originally Posted by bleed_oil View Post
It is absolutely and completely improbable that the Oilers revenue would decrease after the lockout.
Not only has the Canadian dollar increased substantially, they have had a huge increase in ticket prices and are benefitting from a boom in the Alberta economy in the last few year.
Yep, checking the #'s their revenue did increase significantly in 05-06 over 03-04 both in USD and CDN.

However, don't make the mistake of comparing pre-lockout Nichols quotes in CDN$ to post-lockout USD$ figures from Forbes.

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Old
11-09-2007, 04:47 PM
  #12
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Originally Posted by RedScull View Post
Forbes does this analysis without looking at any books for teams. I'm not sure what the point is, to be honest. The report is consistently wrong and every year it gets ripped to shreds on this board, among others.
The point is Forbes get's attention to it's publication and a lot of fans take anything written as gospel because of lack of information, forgetting it's only an estimate with no tangible information to back it.

All very silly. The league and NHLPA set this up for both sides to verify the books so teams can share revenue why not just give the public the true information as verified by both sides?

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Old
11-09-2007, 05:15 PM
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Perhaps I'm old fashioned but isn't value (fair market value) the price a willing buyer would pay a willing seller? If so, isn't the value of the Predators 192M? If you assume the analysis is correct as to the RANKING of the Preds, then aren't there 16 other teams that are under valued on the list? Maybe the value is in the lease but three teams in that group that would seem to command a much higher price are the Pens, Sens, and Hawks.

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Old
11-09-2007, 06:18 PM
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This artical lost all credibility with this litttle gem....

"In addition, greater revenue sharing from the new collective bargaining agreement (CBA) helped teams like the Pittsburgh Penguins and Edmonton Oilers turn a profit. "

The Oilers have not received a cent from Revenue sharing since the new CBA was signed. They have paid into it.

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Old
11-09-2007, 06:25 PM
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So much for the NHL dying if the average franchise value rate is up 23 percent for the league, you'll never hear ESPN report that.

The franchise values are done in US dollars.

Forbes is one of the most respected publications on money matters, so I doubt they are getting their values and revenue wrong..

ps. Anaheim had the 8th most revenue, take that Canadian Press.


Last edited by Randall Graves*: 11-09-2007 at 06:48 PM.
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11-09-2007, 07:03 PM
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Quote:
Originally Posted by RallyKiller View Post

ps. Anaheim had the 8th most revenue, take that Canadian Press.
Possible but not probable if you include playoff revenue. Ottawa would have jumped up even more.

This article has to be missing relevant info.

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Old
11-09-2007, 07:44 PM
  #17
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There are some interesting #'s in the valuation equation if you drill into them. For example, Forbes breaks down the contibutors to the $413mil valuation on the Maple Leafs as:

Sport: $45mil (11%)
Brand Management: $56mil (14%)
Stadium: $129mil (31%)
Market: $183mil (44%)

Big surprise on the Market, eh?



Contrasting the 30th ranked team by Forbes in valuation Nashville

Sport: $41mil (29%)
Brand Management: $14mil (10%)
Stadium: $43mil (30%)
Market: $45mil (32%)

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Old
11-09-2007, 07:50 PM
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Quote:
Originally Posted by CMacdonald View Post
Possible but not probable if you include playoff revenue. Ottawa would have jumped up even more.

This article has to be missing relevant info.
Well if you take the time to read you'll see Forbes reports Ottawa's revenue did jump even more. Up to 6th.

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11-09-2007, 08:04 PM
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Quote:
Originally Posted by CMacdonald View Post
Possible but not probable if you include playoff revenue. Ottawa would have jumped up even more.

This article has to be missing relevant info.
What relevant info is missing? This is FORBES magazine, not an online blog.

If playoff revenue wasn't included then wouldn't the Ducks be even higher if it was?


Last edited by Randall Graves*: 11-09-2007 at 08:10 PM.
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Old
11-09-2007, 10:21 PM
  #20
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Quote:
Originally Posted by mouser View Post
1) Any reference for "I'm sure they got all the sponsorship back"?
No, just common sense. The Oilers have never been as popular as they have been recently. Every game except one since the lockout has been sold. Ticket prices, what used to be bottom 5 in the NHL, were top 5 in 2006-2007. Luxury suite prices nearly doubled.

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Old
11-10-2007, 07:17 AM
  #21
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I would tend to believe that the depth of research that goes into producing
these numbers is much less than many might expect. In the big scheme
of things the NHL is rather small potatoes and an article like this is more
a curiosity than it would be a major piece of news. If you want evidence
that they did not go digging deeply into the books of every team simply
add up their revenue estimates. It comes to $2.436 billion which is out
by a big chuck of change from the actual number.

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Old
11-10-2007, 09:33 AM
  #22
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Quote:
Originally Posted by RallyKiller View Post
So much for the NHL dying if the average franchise value rate is up 23 percent for the league, you'll never hear ESPN report that.

The franchise values are done in US dollars.

Forbes is one of the most respected publications on money matters, so I doubt they are getting their values and revenue wrong..

ps. Anaheim had the 8th most revenue, take that Canadian Press.

Where is this information available, and is there a total figure for Anaheim's HRR?

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Old
11-10-2007, 09:40 AM
  #23
mouser
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Quote:
Originally Posted by Fourier View Post
I would tend to believe that the depth of research that goes into producing
these numbers is much less than many might expect. In the big scheme
of things the NHL is rather small potatoes and an article like this is more
a curiosity than it would be a major piece of news. If you want evidence
that they did not go digging deeply into the books of every team simply
add up their revenue estimates. It comes to $2.436 billion which is out
by a big chuck of change from the actual number.
What is the actual number?

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Old
11-10-2007, 09:53 AM
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It was $2.33 billion last year. That's all individual team revenues plus centrally generated revenues (including national TV $$ in the US and Canada).

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Old
11-10-2007, 10:36 AM
  #25
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Quote:
Originally Posted by Fugu View Post
It was $2.33 billion last year. That's all individual team revenues plus centrally generated revenues (including national TV $$ in the US and Canada).
Which would be expected to be less than the Forbes # since Forbes is attempting to capture all revenue associated with owning a franchise as opposed to the NHL's definition of "Hockey Related Revenue" for CBA cap purposes.

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