John Doe [MN] wrote:Can you explain 'operating income' to me? Somehow, New Orleans has a higher score than Orlando, Detroit is 3rd highest in the league, Philadelphia and OKC are high up on the list with Dallas and Portland all the way at the bottom... It all seems kind of random.
I wish they defined it better, but I imagine its all revenues (ticket sales, merchandise, concessions, parking minus expensises, like salaries for player and staff. I suspect losses from the arena are not included. I also suspect this is information from the 2008-09 season -- the NBA year running July 1 through June 30.
Here's some information on probably the biggest expense (player salaries) and revenue (attendance), and I''ll insert more information I have from other sources as I wave my hands trying to explain the differences for the teams you mentioned.
http://www.storytellerscontracts.info/r ... laries.htmhttp://sports.espn.go.com/nba/attendance?year=2009New Orleans barely broke even, with several near sell-outs and extra play-off games at the end of the season. Bad news this year, with horrible attendance, little chance for extra play-off games, and a new payroll that takes them over the lux. Orlando is $2 mil behind in profit, but paid about $11 mil last season for being over the lux. DET was #1 in attendance and tickets sold last season, and despite being in a small market, OKC's franchise is so new that a lot of people buy tickets to see their games (#11 in attendance). Philly is the 4th biggest market in the US, and teams don't have to share revenues for local broadcasts (within 70 miles). Dallas was $20+ mil over the lux, and the Darius Miles decision cost Paul Allen about $17 mil. POR also suffers from the fact that while they sold a lot of tickets, they were #28 in yield/ticket.
One of the things I'd point out though is how closely packed the majority of teams are. We have mutli-million dollar salaries for players, but its only a few million that sperate many teams. I think most of you probably roll your eyes at me when I say that NOH can't afford a payroll that should amount to $70 mil in losses the next two years. Look where $70 mil puts them on the table! I mention a deal with HOU that will save them $15 mil .. that savings would be half the teams total annual profit! MEM is just going to match any offer for Gay? Even is that made them the biggest loser financially in the NBA?
My point is that owners are running on very narrow profit margins -- if they make a profit at all. Granted some would be OK breaking even if they see a rise in the value of their asset (franchise), but only 5 teams in the NBA had an increase, and the buyers are disappearing. We like to focus on the talent because its the fun part we get to watch, but I think this data shows that owners have to be very careful balancing revenues and expenses.