Why not indulge in the business aspect of the NHL? There is more to it then guys getting on the ice and making beautiful passes in the blue lines, goalies making saves on their backs and top A-listers making those wrister shots catching the back of the net. And well, Forbes’ just released a list of the franchised values in the NHL and I broke out not one but two calculators to help bring to life these 10 observations!
In the business of the NHL the team values hit an all-time high this year but do not let this fool you because player costs are climbing and essentially eroding the sport’s profitability. The average hockey team is now worth $240 million, 5% more than last year due to a 5% increase in revenue during the 2010-11 season, to an average of $103 million per team. The sport’s popularity ontelevision (NBC’s broadcast of theBridgestone NHL Winter Classic was the most-viewed NHL regular season game in 36 years, with an average of 4.5 million watching during prime time) and online (average monthly unique visitors to NHL.com plus all 30 NHL team Web sites has increased to a record 22 million) is up, as is the revenue from those platforms.
Top 10 Observations:
1. The Capitals have nearly doubled their value since 2004, from $115 million to roughly $225 million. And this can be linked to SportsRantz “Public Enemy #2”, Alexander Ovechkin and he’s already made Ted Leonsis a pile of money on paper. No way Washington is worth as much without Ovi.
2. There are four teams carrying the most debt on their backs in the NHL. Those teams are: New Jersey (144%), Dallas (126%), St. Louis (81%) and Carolina (77%). But we can pretty much cross the Stars off this list now because they have a new owner now. But there’s a reason the Devils have reportedly been flirting with bankruptcy, the Blues are for sale, and the Hurricanes were forced to bring in a bunch of new investors. It’s a dangerous time to be highly leveraged.
3. The Leafs’ operating income is estimated at $81.8 million, by far the most in the NHL. And that’s without any postseason revenue. Imagine if they actually make the playoffs this season. Tickets probably won’t be cheap.; but for the first time in a few years the Leafs’ fans would be happy.
4. The Winnipeg Jets Jets are valued at $164 million. They were sold this summer for $110 million, plus a $60 million relocation fee paid to the NHL for the privilege of moving out of Atlanta. Now consider the NHL bought the Phoenix Coyotes for $140 million two years ago. Given the City of Glendale is covering annual losses up to $25 million, could the league end up making a profit on its purchase if the franchise relocates at the end of the season?
5. The Flyers’ revenue fell by $10 million. Presumably the difference between making the Stanley Cup final in 2010 and losing in the second round last season. And this team is looking at making another late run in the playoffs this year which will boost this -4%.
6. Despite the economy, only seven teams are worth less today than they were last year. For those wondering why Gary Bettman makes a lot of money, there you go.
7. Over half the Islanders’ franchise value is attributed to its market, which Forbes says is worth $78 million. Nashville’s market, in contrast, is valued at just $52 million. Translation: the NHL will do everything it can to facilitate the building of a new arena that will keep the Isles where they are. You don’t walk away from affluent, densely-populated markets like Long Island without a fight…Shocked?
8. Why not? The Rangers’ franchise value rose by $46 million over last year. The prospect of a renovated Madison Square Garden with all the additional revenue sources that come with modern arenas was a big reason why. They’re not sinking $850 million into MSG because it was looking a little drab.
9. The Detroit Red Wings are worth $336 million. Mike Ilitch bought them in 1982 for $8 million. Nice little investment and it doesn’t hurt to add up all those Stanley Cup Championships either. I’d say that was money well spent.
10. The Toronto hockey market is estimated to be worth $254 million. Thus, the talk of adding a second team. Also, the reason the Leafs are so protective of their territory. The monopoly they enjoy comprises a huge chunk of their franchise value. Obviously they’ll want to be compensated if another team moves in.
Well, I hope these facts blew your mind like they blew up my first calculator into this research. The Business of Hockey is booming just as the play on the ice is and everyone can be happy with that!