Part 5: True North Sports & Entertainment's efforts to acquire an NHL team (Winnip

[danishh]

cbc's revenue calcs:

jetsowner's:

cbc gives them a full revenue-sharing share (ie they are a cap-midpoint team and meet all other revenue sharing goals) and bumps the tv revenue, and luxury box revenue up. Lowers the in-arena revenue a bit.

cbc assumed 14000 attendance, and i assume lower prices as well.

 

[Dado]

Ticket Sales: $45M

That seems to be the same ballpark most are in. My question is more about what that looks like in terms of ticket prices and required attendance levels. For a straight average cost at 95% (paid) attendance, that's somewhere around $75/seat.

Is that realistic? (honest question, I don't know Winnipeg at all)

 

[Crazy_Ike]

Maybe they can buy the Leafs and move them now that the teachers have put them up for sale.

 

[htpwn]

Maybe they can buy the Leafs and move them now that the teachers have put them up for sale.

Who knew a team in Winnipeg was worth ~$800 million?

 

[kdb209]

Maybe they can buy the Leafs and move them now that the teachers have put them up for sale.

Or Thomson can buy the Leafs and leave TNSE without deep pockets .

 

[y2kcanucks]

These were the numbers HNIC used to illustrate the NHL's viability in Winnipeg.

Not sure how they compare to #'s others have run around here.

Ticket Sales: $45M
Suite Sales: $10M
Broadcast: $19M
In Arena Sales: $15M
Revenue Sharing: $13M

Total: $102M

They went on to say TNSE brings in $10M from concerts/shows/events annually, it wasn't clear if that was profit or revenue.

According to Forbes, that would put them 9th in the NHL (the $102M figure). Without the revenue sharing they would be at 16th in the NHL.

Currently, Phoenix is at 29th with revenues (last year) of $67M.

 

[GSC2k2*]

These were the numbers HNIC used to illustrate the NHL's viability in Winnipeg.

Not sure how they compare to #'s others have run around here.

Ticket Sales: $45M
Suite Sales: $10M
Broadcast: $19M
In Arena Sales: $15M
Revenue Sharing: $13M

Total: $102M

They went on to say TNSE brings in $10M from concerts/shows/events annually, it wasn't clear if that was profit or revenue.

I saw those on HNIC tonight, as did many of us. Suffice to say that my jaw dropped. It dropped because clearly no one checked the handiwork of Mr. Oake or his apparently financially challenged staff.

I have had some financial projections in my back pocket for WPG for quite some time but have held off for fear that it would drive some people over the edge, to be perfectly frank.

In short, with the possible exception of the suite revenue (which is still inaccurate, but only in a relatively minor way), the rest of the numbers are ridiculous. THe in-arena sales numbers are the worst in terms of inaccuracy, followed by the broadcast revenue. I will write off the revenue sharing to a simple inability to understand the NHL revenue sharing mechanism. $45M in ticket sales? That seems to contain a number of holes, albeit through making assumptions as to how one could go about that with what Oake stated was 14,500 in average paid attendance.

$80M would be the most optimistic assumption possible, if EVERYTHING went right. $102M is simply either delusional or produced by someone who has no understanding of sports finances. IMO, of course. Playoff games excluded of course.

BY the way: those "100 events" on top of hockey that Oake mentioned? Try about 69, between April 2010 and March of 2011. A fine performance, no doubt, but why exaggerate it by 50%, particularly when it can be counted in about 90 seconds like I just did? If it was 90 or so, I would write that off to a mild exaggeration. Rounding up 69 to 100? Nope.

Shout out to Killion: what do you think about producing $15M in fees from 69 events?

EDIT: I am of course not referring to gross revenue on the non-hockey events, K.

 

[cbcwpg]

BY the way: those "100 events" on top of hockey that Oake mentioned? Try about 69, between April 2010 and March of 2011. A fine performance, no doubt, but why exaggerate it by 50%, particularly when it can be counted in about 90 seconds like I just did? If it was 90 or so, I would write that off to a mild exaggeration. Rounding up 69 to 100? Nope.

Like all things that involve projections, that's the problem, they are projections. The time frame of note that you looked at ( Apr 2010 and on ) happens to encompass the lowest number of events in a year since the MTS Centre opened. As all arenas in North America seem to be doing right now, numbers are down. Historically they have been around 100 non-hockey events per year.

As far as HNIC's numbers I think they are a bit high as well. I'm no expert, but I came up with approx. $70M revenue per season ( no revenue sharing because I no idea what that would be ). Regardless TNSE has crunched their own numbers and must be OK with them, otherwise I don't think they would be trying to land a team.

 

[AllByDesign]

Those are numbers that are certainly inflated from any real forecast... Now where have I recently noticed an inflated forecast.... it was somewhere...

Just to be fair.

 

[GSC2k2*]

Like all things that involve projections, that's the problem, they are projections. The time frame of note that you looked at ( Apr 2010 and on ) happens to encompass the lowest number of events in a year since the MTS Centre opened. As all arenas in North America seem to be doing right now, numbers are down. Historically they have been around 100 non-hockey events per year.

As far as HNIC's numbers I think they are a bit high as well. I'm no expert, but I came up with approx. $70M revenue per season ( no revenue sharing because I no idea what that would be ). Regardless TNSE has crunched their own numbers and must be OK with them, otherwise I don't think they would be trying to land a team.

You sure you want to stick with that? You can go to their website and count them, you know.

On the hockey side, I suspect $70M is very conservative. If they were at $70M, they would certainly qualify for some revenue sharing, albit not at the level of the current PHO franchise.

I would assume that Mr. Chipman is not an idiot and has done some modeling. Matthew Hulsizer has done some modeling as well.

 

[dkehler]

I think the NHL itself has studied the market and estimates $75 million in revenue.

 

[Dado]

At $75M you're likely looking at a cap-floor team. Possibly less. Is that likely to be good enough to draw?

 

[Puckschmuck*]

Suffice it to say, that no matter how hard you try to provide backup to your claims on certain issues, it will never be enough for some people, who have clear bias towards Winnipeg failing *ahem, I'm looking at you, GSC2k2*. Yes, I read the posts about you earlier today, and have to agree with what was said about you being bias earlier. I tried to give you the benefit of the doubt upon your return, however I was clearly mistaken in doing that. It's the same old same old from you. The only way to prove this is when the team returns. I will enjoy watching all the Winnipeg doubters choke on their words when they realize we are indeed a viable market.

Yes, I will enjoy that very much.

 

[dkehler]

At $75M you're likely looking at a cap-floor team. Possibly less. Is that likely to be good enough to draw?

For the first few years, certainly.

Please note, I'm only telling you what I have heard. I make no claim on the accuracy of it.

From what I have heard, True North expects/plans to run a mid cap-level team most of the time and might be prepared to go higher if they feel they can make a cup run.

 

[cbcwpg]

You sure you want to stick with that? You can go to their website and count them, you know.

I counted one year 2005 and it was 133 events ( 41 hockey ), so it was 92 non-hockey. Close enough. As for the rest, sorry, busy watching hockey. You could be right, but I'm just going by what has been published in the past.

 

[Le Golie]

Wpg Guy,

Many already look like fools because a few years back they considered it absurd to suggest Winnipeg may be on the NHL's radar in the future.

I think that's where a lot of the insecure bitterness comes from with the anti-Winnipeg posters. They were blue in the face arguing that Winnipeg never had a chance. Now they look foolish and they really, really don't like looking foolish.

 

[Le Golie]

Like all things that involve projections, that's the problem, they are projections. The time frame of note that you looked at ( Apr 2010 and on ) happens to encompass the lowest number of events in a year since the MTS Centre opened. As all arenas in North America seem to be doing right now, numbers are down. Historically they have been around 100 non-hockey events per year.

As far as HNIC's numbers I think they are a bit high as well. I'm no expert, but I came up with approx. $70M revenue per season ( no revenue sharing because I no idea what that would be ). Regardless TNSE has crunched their own numbers and must be OK with them, otherwise I don't think they would be trying to land a team.

What does TNSE know? Clearly hockey message board posters know as much or more.

 

[AllByDesign]

Count me as someone who never believed Winnipeg would ever return to the NHL's radar. Well... There ya go. Been saying that quite a bit today.

 

[cbcwpg]

Wpg Guy,

Many already look like fools because a few years back they considered it absurd to suggest Winnipeg may be on the NHL's radar in the future.

I think that's where a lot of the insecure bitterness comes from with the anti-Winnipeg posters. They were blue in the face arguing that Winnipeg never had a chance, now they look silly, and they really, really don't like looking silly.

Agreed. Hey, I will be the first one that says it won't be a cake walk and it isn't without its risks, but the vast majority of anti-Winnipeg posters ( the Canadian ones ) just can't get over the fact that another team is not going to find its way to Southern Ontario, which according to everyone is a lock.

 

[Dado]

Well I'm happy a team is coming home to a place that can appreciate it. I hope it works and they stay there a long long time.

 

[kdb209]

cbc's revenue calcs:

jetsowner's:

cbc gives them a full revenue-sharing share (ie they are a cap-midpoint team and meet all other revenue sharing goals) and bumps the tv revenue, and luxury box revenue up. Lowers the in-arena revenue a bit.

cbc assumed 14000 attendance, and i assume lower prices as well.

According to Forbes, that would put them 9th in the NHL (the $102M figure). Without the revenue sharing they would be at 16th in the NHL.

Currently, Phoenix is at 29th with revenues (last year) of $67M.

Based on those numbers, it's possible that Winnipeg will not be eligible to receive any Revenue Sharing - and they certainly wouldn't get anywhere near $13M.

If a Club's "Available Team Player Compensation" (57% of the teams Gross Preseason and Regular Season Revenues) exceeds the "Targeted Team Player Compensation" (a payroll of the Cap Midpoint minus $4M plus benefits) then that Club does not receive any revenue sharing. If it is less, then revenue sharing makes up that difference.

For this season, a team with Gross Pre- and Regular Season Revenues of > ~$87M would not receive revenue sharing (based on a Cap Midpoint of $51.4M and benefits of $2.2M/team). A team with ~$80M in revenues would get ~$4M, a team with ~$70M would get ~$10M.

If the Club had a Actual Club Salary less than the Cap Midpoint, they would still be eligible for an allotment equal to that difference as part of the Final Escrow Disbursement if excess escrow funds were available, with some limitations - 57% of (gross revenues + revenue sharing) + escrow allotment < Cap Midpoint.

 

[Jet]

I saw those on HNIC tonight, as did many of us. Suffice to say that my jaw dropped. It dropped because clearly no one checked the handiwork of Mr. Oake or his apparently financially challenged staff.

I have had some financial projections in my back pocket for WPG for quite some time but have held off for fear that it would drive some people over the edge, to be perfectly frank.

In short, with the possible exception of the suite revenue (which is still inaccurate, but only in a relatively minor way), the rest of the numbers are ridiculous. THe in-arena sales numbers are the worst in terms of inaccuracy, followed by the broadcast revenue. I will write off the revenue sharing to a simple inability to understand the NHL revenue sharing mechanism. $45M in ticket sales? That seems to contain a number of holes, albeit through making assumptions as to how one could go about that with what Oake stated was 14,500 in average paid attendance.

$80M would be the most optimistic assumption possible, if EVERYTHING went right. $102M is simply either delusional or produced by someone who has no understanding of sports finances. IMO, of course. Playoff games excluded of course.

BY the way: those "100 events" on top of hockey that Oake mentioned? Try about 69, between April 2010 and March of 2011. A fine performance, no doubt, but why exaggerate it by 50%, particularly when it can be counted in about 90 seconds like I just did? If it was 90 or so, I would write that off to a mild exaggeration. Rounding up 69 to 100? Nope.

Shout out to Killion: what do you think about producing $15M in fees from 69 events?

EDIT: I am of course not referring to gross revenue on the non-hockey events, K.

ok... just to keep track: John Shannon, gives hope that the Coyotes might stay = reputable

Scott Oake: shows numbers that suggest the NHL could work well in Winnipeg = financially challenged.

Gotcha.

 

[Gump Hasek]

Wpg Guy,

Many already look like fools because a few years back they considered it absurd to suggest Winnipeg may be on the NHL's radar in the future.

I think that's where a lot of the insecure bitterness comes from with the anti-Winnipeg posters. They were blue in the face arguing that Winnipeg never had a chance. Now they look foolish and they really, really don't like looking foolish.

Great post.

A local reporter is now saying that TNSE already has designed a jersey and a team name has been chosen.

http://www.winnipegsun.com/life/columnists/dave_wheeler/2011/03/12/17596211.html

Manitoba Polar Bears perhaps?

 

[Jeffrey93]

ok... just to keep track: John Shannon, gives hope that the Coyotes might stay = reputable

Scott Oake: shows numbers that suggest the NHL could work well in Winnipeg = financially challenged.

Gotcha.

What does one have to do with the other? And what does any of this have to do with what he said in his post?

I'd think discrediting another poster would be done by challenging the content of his post....not bringing up other posts from other topics. Then making a pretty big leap that his take on two different people and two different subjects are somehow related and shows some sort of inconsistency.

 

[Retail1LO*]

Maybe it's just me...but anything short of the Jets...seems...lame. Furthermore, having the provincial name out in front instead of Winnipeg, is even more lame.