KHL business aspects discussion

[Rigafan]

Russia’s Kontinental Hockey League raked in over $50 mln over past season
Russia’s Kontinental Hockey League raked in over $50 mln over past season

Not sure if it was covered yet? Basically the league sponsorship income is up 20% and the TV deal revenue grew by 15%.

The league also gave $4.3m to the Russian hockey federation and to touch on expansion - talks in place with a Paris team based out of the Bercy Arena and a team in Marseille .

 

[SoundAndFury]

And then you realize this entire profit is roughly the same sum is what 2 KHL mid-table teams spend to participate in it.

 

[vorky]

Would it be possible to sum up a logo at center ice for all teams this season? Slovan has Mastercard logo at center ice for example. Other teams have club´s logo. Does any other team have Mastercard or other sponsor at center ice?

 

[Toro2017]

On one side KHL wants to give big money to the likes of SKA and ZSKA, but on the other hand they would not like to spend the same money abroad. They would like to have salary gap, but not for all. So should they remake the whole competition? Build it, in kind of a two level system. First level could be renamed something like Russian Super League and the second level could continue with the old name KHL.

In the new RSL would play SKA, ZSKA, Omsk, AK Bars, UFA and Magni. They would play one game against every KHL team and then eight games against every other team in the new RSL. That should amount to 60 games (1x20 + 8x5). In new RSL there would be no salary gap and foreigner limit would go up to 8 or even 10. This competition would pause for EHT tournaments (if need be), because the core of the russian national team would play here.

KHL would continue with 20 teams, divided in two conference and four division.

Western Conference:
Bobrov: S.Bratislava, D.Riga, Jokerit, D.Minsk and Vitjas
Tarasov: D.Moscow, S.Moscow, Sevestral, Sochi and Jaroslav

Eastern Conference:
Kharlamov: Torpedo, Lada (gets back in), Neftehimik, Cheljabinsk and Jekaterinburg
Chernyshev: Barys, Sibir, Kunlun, Admiral, Amur

These teams would play once against every new RSL teams, twice against every teams in other divisions and six times against every team in home division. That should amount to 60 games (1x6 + 2x15 + 6x4). In this new KHL there would be hard salary gap and foreigner limit for every russian teams would be five. This competition would not pause for EHT tournaments, because they have to travel more in regular season.

Playoffs:
In new KHL eight teams would go to playoffs (four best teams from both conference) and they would play for the victory of continental competition. On the other side all six new RSL teams will get to playoffs too and two best russian teams from KHL, that failed to get in KHL playoff. These teams would play for the victory of Russian hockey. Then both winners will meet in gagarin cup final.

 

[Rigafan]

KHL Email Survey

https://survey.khl.ru/822327?newtest=Y&lang=ru

Did anybody else receive this and fill it out? Relativity interesting for a survey, took me about 10 minutes. I basically begged them to stock geo blocking.

From the reading on the survey they are asking a lot about pricing of games and if you would pay for a monthly subscription and how much etc.

It's in Russian but if you use Chrome you can just auto translate each page

 

[vorky]

According to Interfax database, SKA revenues were 8 billion rubles (around 113M euro) in 2018. The net income was 543M rubles (around 8M euro) in 2018.

If you have any complains, go to Interfax. I just copied the text.

 

[Kshahdoo]

According to Interfax database, SKA revenues were 8 billion rubles (around 113M euro) in 2018. The net income was 543M rubles (around 8M euro) in 2018.

If you have any complains, go to Interfax. I just copied the text.

Yeah, here is the link. Interesting figures. I don't wanna say, I don't trust them, but it'd be interesting to see a detailed report. I don't understand, how they managed to earn so much money. They couldn't get more than 400M rubles from tickets. So they somehow got 19 times more from other sources. I mean, NHL teams still get most of their money from tickets, so SKA can teach them, how to do a hockey business? And it's considering, KHL does get almost nothing for TV rights.

Does sponsor money count as revenue, btw? If yes, then as I underrstand, SKA just got most of its revenue from Gazprom.

 

[Exarz]

Yeah, here is the link. Interesting figures. I don't wanna say, I don't trust them, but it'd be interesting to see a detailed report. I don't understand, how they managed to earn so much money. They couldn't get more than 400M rubles from tickets. So they somehow got 19 times more from other sources. I mean, NHL teams still get most of their money from tickets, so SKA can teach them, how to do a hockey business? And it's considering, KHL does get almost nothing for TV rights.

Does sponsor money count as revenue, btw? If yes, then as I underrstand, SKA just got most of its revenue from Gazprom.

No, a firm's revenue consists of the total sales income over the period. So sponsor money is not directly included.

The revenue is insanely high (in comparison, all the SHL clubs' total revenue during the 2017-18 season was around 160 million €). Maybe Gazprom pays a few million euros for their box each game

 

[Kshahdoo]

No, a firm's revenue consists of the total sales income over the period. So sponsor money is not directly included.

The revenue is insanely high (in comparison, all the SHL clubs' total revenue during the 2017-18 season was around 160 million €). Maybe Gazprom pays a few million euros for their box each game

Yeah, they probably sell corporative tickets for insane money, but it's still isn't enough to earn that much money. I can only imagine, what Zenit earns with its 60k+ arena...

 

[vorky]

I have just numbers for 2017, but still better than nothing.

Zenit
revenues 9,7B rubles (138M euro)
net income -231M rubles

Just to compare (2017) if you wish

Gazprom
revenues 4,3 trillion rubles
net income 100 billion rubles

Rosneft
revenues 4,9 trillion rubles
net income 139 billion rubles

VTB Capital
revenues 39 trillion rubles
net income 10 billion rubles

I did not care to convert it into euro, too much math If I know, they are 3 biggest companies based in Moscow.

 

[Jussi]

I did not care to convert it into euro, too much math

Or too much typing/copypasting?

XE Currency Converter - Live Rates

 

[TheWhiskeyThief]

According to Interfax database, SKA revenues were 8 billion rubles (around 113M euro) in 2018. The net income was 543M rubles (around 8M euro) in 2018.

If you have any complains, go to Interfax. I just copied the text.

You’re only repeating what they put out, so no sense shooting the messenger.

I might believe the profit, but the revenue number is a joke.

That would put them in an above average NHL territory and the GDP of Russia just can’t throw off that kind of revenue even with oligarch support. Not nearly enough gate receipts or TV, sponsorship via the league ain’t all that so it’s direct funding and for what?

If they were a NHL team, they’d have to spend $65mm on players at a minimum, which the KHL rules would prohibit. They’d have to be spending $40mm on the youth system.

So color me skeptical.

 

[vorky]

I looked at SPARK-Interfax database. just for @TheWhiskeyThief.

The database consists of official tax returns. If you have any complaints, you need to contact the Federal Tax Service of the Russian Federation. So, go to them with your scepticism.

I would like to correct your words saying, "If they were a NHL team, they’d have to spend $65mm on players at a minimum, which the KHL rules would prohibit. " It is not true that it was prohibited in the KHL to spend $65mm on players at a minimum for 2017-2018 & 2018-2019. The tax return in question is from the year 2018.

 

[Omark]

SKA revenue is probably similar to Jokerit; which is 7,7 million €. If someone actually think their revenue is over 100m you have to be insane.

Attendance figures are about the same but tickets and arena food/drinks are cheaper in SKA games.

Jokerit’s tv deal value is much higher than SKA’s but that doesn’t show up in revenue figures because KHL balances tv income to all teams.

 

[Omark]

Rotenberg said 2014 that SKA revenue is 12,6m€.

Link: https://www.themoscowtimes.com/2014...57-million-into-2-russian-hockey-teams-a36215

 

[vorky]

Rotenberg said 2014 that SKA revenue is 12,6m€.

Link: https://www.themoscowtimes.com/2014...57-million-into-2-russian-hockey-teams-a36215

I do not want to be nitpicking, you know, but let us be correct.

What did Rotenberg say to this media outlet? "SKA had revenues of 500 million rubles ($14 million) for the current season"

First, the tax return is for a fiscal year, not season, but still... it is correct what he said. Just one note, 500 million rubles was net profit, not revenue. But to avoid misunderstanding, I will use the Russian terms.

SKA 2014
Выручка (revenue) was 4,7B rubles (66,5M euro)
Прибыль (net income) was 525M rubles (7,4M euro)

As I understand it, Rotenberg talked about Прибыль. If you are a tax expert, you may correct me. All data are publicly available, the source is the Federal Tax Service of the Russian Federation. If SKA lied to the Tax Service, it is another story. But it is difficult to imagine such a scenario.

 

[Omark]

I do not want to be nitpicking, you know, but let us be correct.

What did Rotenberg say to this media outlet? "SKA had revenues of 500 million rubles ($14 million) for the current season"

First, the tax return is for a fiscal year, not season, but still... it is correct what he said. Just one note, 500 million rubles was net profit, not revenue. But to avoid misunderstanding, I will use the Russian terms.

SKA 2014
Выручка (revenue) was 4,7B rubles (66,5M euro)
Прибыль (net income) was 525M rubles (7,4M euro)

As I understand it, Rotenberg talked about Прибыль. If you are a tax expert, you may correct me. All data are publicly available, the source is the Federal Tax Service of the Russian Federation. If SKA lied to the Tax Service, it is another story. But it is difficult to imagine such a scenario.

He was talking about revenue, or are you saying that paper translated revenue and net profit incorrectly?

Rotenberg also talked about SKA business situation in Helsinki 2014 during Jokerit expansion thing and he also gave similar numbers back then.

He then and in that paper also said that SKA want’s to decrease dependence on Gazprom money. Why would they be dependent on Gazprom money if their player budget is 32,45m€ and their revenue is 66,5m€? If the team is take care properly, they wouldn’t be dependent at all in that sitution.

But none of this is relevant. Their revenue was 12m € like it is said in that article by Roman Rotenberg.

 

[vorky]

So, you say the data provided by the Federal Tax Service of the Russian Federation are incorrect?

 

[TheWhiskeyThief]

So, you say the data provided by the Federal Tax Service of the Russian Federation are incorrect?

Hey, if you have Putin riding shotgun for you, you can say you made 80 trillion ruble in revenues and lost money for any number of reasons.

I’m not saying they’re incorrect, I’m saying they’re false.

 

[vorky]

I have no idea why you are bringing non-hockey issues to the discussion.

You say they are false. Others say they are correct, just you do not understand how it is counted. All story.

 

[Exarz]

Here's SKA's financial statements of 2013-2017: Отчетность организации ООО "ХОККЕЙНЫЙ КЛУБ СКА".

To suggest that SKA deals with financial statement fraud is a pretty bold statement. However, I doubt that SKA has sold tickets, merchandise, food, drinks etc. for more than 100 million euros each year, so something else must be included.

Gazprom are the founders of SKA's limited company, maybe SKA is registered for some gas sales as well

 

[vorky]

Here's SKA's financial statements of 2013-2017: Отчетность организации ООО "ХОККЕЙНЫЙ КЛУБ СКА".

To suggest that SKA deals with financial statement fraud is a pretty bold statement. However, I doubt that SKA has sold tickets, merchandise, food, drinks etc. for more than 100 million euros each year, so something else must be included.

Gazprom are the founders of SKA's limited company, maybe SKA is registered for some gas sales as well

These are the same numbers as I work with.

Of course, some posters immediately jumped into the statements of "false data", "tax fraud" or "Putin." Such statements are easier to write than going into details of the Russian tax law or finding real financial statements as you did. But the purpose is achieved, to criticise the KHL & Russia.

Back to SKA & KHL. As we know the E&Y released the KHL review for the 2017-2018 season and they count the sponsorship money/government funds as revenues for the clubs. But again, the same problem, just a few people care to study such documents. And even less try to understand them.

Generally, if we look at the KHL and their clubs, attendance is rising, now the KHL is 2nd in Europe even though some posters try to convince us the KHL is behind DEL. The sales are rising as well. The KHL has never been more profitable.

Regarding SKA, we need to know that sales are higher after the championship season. SKA won the title in 2015 & 2017. We need to take into account a fact that SKA heavily invested into their Hockey Town Academy in 2017 & earlier.

 

[FF de Mars]

Would AccorHotels Arena in Paris fit the KHL, 17k seats, renovated in 2015? How much does it cost to buy a KHL franchise, I'm daydreaming.

 

[vorky]

Would AccorHotels Arena in Paris fit the KHL, 17k seats, renovated in 2015? How much does it cost to buy a KHL franchise, I'm daydreaming.

There are talks about bringing a KHL team to Paris. AccorHotels Arena is one option for them, another is a venue under construction for Olympics. Of course, AccorHotels Arena would fit, but they have many other events there.

If I know, a club needs to guarantee a budget for at least 3 seasons, with 10M euro (at least) each season. Also, they need support from hockey federation which they already have. Luc Tardiff supports them.

 

[Section Netherlands]

So, does that mean that a millionaire taking on the project of a French KHL team is the one thing missing for expansion there?