NHL revenue projections/cap likely to be revised downward

[Fourier]

The NHL's numbers would be based on projections extrapolated using recent growth rates. But we all know the economic growth in the US is not sustainable, given the trade wars and massive tax cut for corporations that was paid for by huge deficit spending.

When the economy hits the inevitable recession that's now overdue, sports will be one of the very first industries to suffer, as it's one of the easiest places for people to stop spending money.

I'm not saying the article is correct. It may not happen this year. But when the recession does hit, the NHL's salary cap projections are going to be way off.

The NHL's projections would be based on preliminary data from teams and from other revenue sources. Typically these early predictions are actually quite accurate.

The first thing one might note is that the article incorrectly claims that revenues last year grew by 3%. The actual number was 6%. The prediction of $83M would mean an organic growth rate of roughly 5% which is historically reasonable. That would take you to about $83.6M. From this you can subtract about $600K to account for the lower $CDN.

I could see a modest drop but not nearly as extreme as this article predicts.

 

[dechire]

The first thing one might note is that the article incorrectly claims that revenues last year grew by 3%.

No it doesn't. It says that in October, this year's (2018-19) revenue was predicted to increase by 3%.

 

[Fourier]

No it doesn't. It says that in October, this year's (2018-19) revenue was predicted to increase by 3%.

Ok. I think I misread the intent of the phrase "this year vs last year". Though where was this prediction made since I see no record of it anywhere on the BoH Board and they tend to never miss such references. But aside from that where is the evidence that we would be looking at a 2% increase vs the NHL's very recently stated number.

 

[dechire]

Ok. I think I misread the intent of the phrase "this year vs last year". Though where was this prediction made since I see no record of it anywhere on the BoH Board and they tend to never miss such references. But aside from that where is the evidence that we would be looking at a 2% increase vs the NHL's very recently stated number.

Here is the BoH thread. A cap estimate of 81.4m would be around 3.7% revenue growth. The announced 83m cap estimate is in line with that previous report since the BOG's cap estimate always includes some % of escalator, in this case ~2% based on the 81.4m estimate. My best guess is that the 3.7% revenue increase is close to accurate but the NHLPA will elect to use less escalator than the NHL is predicting and the cap will end up somewhere around 82.5m but my guess is as good as any right now. If this new information is accurate and revenue only increases by 2% then that would be huge but without more information it's hard to say.

 

[Fourier]

Here is the BoH thread. A cap estimate of 81.4m would be around 3.7% revenue growth. The announced 83m cap estimate is in line with that previous report since the BOG's cap estimate always includes some % of escalator, in this case ~2% based on the 81.4m estimate. My best guess is that the 3.7% revenue increase is close to accurate but the NHLPA will elect to use less escalator than the NHL is predicting and the cap will end up somewhere around 82.5m but my guess is as good as any right now. If this new information is accurate and revenue only increases by 2% then that would be huge but without more information it's hard to say.

Thanks. I was also aware of this prediction which is why I mentioned a modest drop from the $83M as the 1.25% escalator used last year puts you in the $82.5 region which you and I seem to agree upon.

 

[Mr Tadakichi]

Haha f*** you chia.

 

[Kaapo Cabana]

The price for taking on bad contracts just went up.

 

[DuckyChuck]

So, I can expect my season ticket prices to go up more than usual next season, to make up for the lost revenue? Nice....

 

[CartographerNo611]

I think I’m in the minority when I want to see the cap go down 5-10 million to see teams scramble to shed salary.

 

[eddygee]

So, I can expect my season ticket prices to go up more than usual next season, to make up for the lost revenue? Nice....

I'm confused as all we heard was talk of record revenues of 4 billion at the end of last season. Maybe it was said but where is the shortfall I know they wouldn't base projections of revenue just off the Canadian dollar that fluctuates.

 

[JianYang]

Not so hard to believe that TV revenues are not growing much, even for live event like pro league sports.

Regular season NHL fanbases is getting quite old and will probably decline:
Going gray: Sports TV viewers skew older

Apparently the median TV viewers age for the NHL went from 33 in 2000 to 49 in 2016.

The % of the fanbase that is aged 2-17 lost 50%, from 16% to 8%, the decline could be ugly when the current 50-65 will stop being interesting for the advertiser.

What about the other sports? Are those fans getting older too, or is it just hockey?

I wonder if the youngsters are into esports more than actual sports.

 

[pigpen65]

Bring back checking. The boards are lonely.

 

[Team Cozens]

Would love to see the Cap go down. Man, that would turn the league on it's head.
Trades everywhere.

 

[Yatzhee]

What raised my eyebrow the most was the fact that ticket sales are down.

Yep, mine to.
Various factors, not the least of which is prices are way up. Larger market teams consistently emptying the UFA market, leaving mid and small market teams to depend entirely or near entirely on drafting, where talent development is a coin toss.
And other factors.

 

[cliffclaven]

So, I can expect my season ticket prices to go up more than usual next season, to make up for the lost revenue? Nice....

I just read today that leafs season tickets are going up $7 to $16 next year.

 

[cliffclaven]

What about the other sports? Are those fans getting older too, or is it just hockey?

I wonder if the youngsters are into esports more than actual sports.

NFL is down about 10% also

 

[TheDoldrums]

This would be beneficial to teams with star RFA's to sign this offseason since these deals are based on cap hit percentages.

 

[MadLuke]

What about the other sports? Are those fans getting older too, or is it just hockey?

I wonder if the youngsters are into esports more than actual sports.

The link do show all the main sports, Nascar/Baseball/UFC/Football are also getting older, the NHL is the one main league that aged the most but not with the oldest fans yet.

NBA is the main sport that aged the less with only +2.

 

[eddygee]

What about the other sports? Are those fans getting older too, or is it just hockey?

I wonder if the youngsters are into esports more than actual sports.