New Summary of Os Nats MASN TV Rights

[Can_of_corn]

I saw that too and I know Clancy was in from day one. About a 1/4 share. $250 over 20 years ('93 - '13) is 12.5 per year. So the whole cadre of investors is making about $50 mill per year.

I don't know for sure but I assume Clancy was also in for the same share in MASN. So if they're all "only" making $50 mill a year, the budget is a lot tighter than most of us speculate.

His 1/4 share became a 1/8 share with his divorce.

[weams]

His 1/4 share became a 1/8 share with his divorce.

I think that was accounted for in the calculation of his original investment. I think the 250 was the total share divided between him and the ex.

[Frobby]

With regard to the OP, I am not sure what is "new" about the analysis there. Two of the three articles that are linked there re from the spring of 2012, and the third is from January 2013.

I think the following quote from the Tom Clancy article demonstrates that the $70 mm profit estimate in the OP is fanciful:

According to SNL Kagan, MASN is expected to generate about $146 million of revenue and $29 million of cash flow this year.

"Cash flow" is not synonymous with "profit," but it is close enough for this purpose. "Cash flow" means that MASN had $29 mm more cash on hand at the end of the year than at the beginning. About $25 mm of that "belongs" to the Orioles. So, you could argue that payroll could have been $25 mm higher than it was, if the MASN cash flow had been distributed out. Of course, that cash could be used for lots of different purposes: expanding or improving MASN's operations, improving the Orioles' player development system or facilities, or just paying it out to the ownership group. But in any event, $25 mm is not $70 mm.

[weams]

With regard to the OP, I am not sure what is "new" about the analysis there. Two of the three articles that are linked there re from the spring of 2012, and the third is from January 2013.

I think the following quote from the Tom Clancy article demonstrates that the $70 mm profit estimate in the OP is fanciful:

"Cash flow" is not synonymous with "profit," but it is close enough for this purpose. "Cash flow" means that MASN had $29 mm more cash on hand at the end of the year than at the beginning. About $25 mm of that "belongs" to the Orioles. So, you could argue that payroll could have been $25 mm higher than it was, if the MASN cash flow had been distributed out. Of course, that cash could be used for lots of different purposes: expanding or improving MASN's operations, improving the Orioles' player development system or facilities, or just paying it out to the ownership group. But in any event, $25 mm is not $70 mm.

And as someone who does understand these nuances intimately, I am glad you put the facts out there definitively for all to see. Thanks.

[TonySoprano]

Profit doesn't equal cash flow in a business. To find out if you made a profit or had a loss for the year, you look at the bottom line in your P&L (profit and loss) report. But you must understand that the bottom line does not tell you cash flow from your profit-making activities.

Don’t ever assume that making profit increases cash the same amount. A business’s cash flow can be considerably higher than bottom-line profit, or considerably lower. Cash flow can be negative when you earn a profit, and cash flow can be positive when you have a loss. There’s no natural correlation between profit and cash flow.

source - Accounting for Dummies

profit and cash flow are two entirely different concepts, each with entirely different results. The concept of profit is somewhat narrow, and only looks at income and expenses at a certain point in time. Cash flow, on the other hand, is more dynamic. It is concerned with the movement of money in and out of a business. More importantly, it is concerned with the time at which the movement of the money takes place.

source - bizfilings.com

In any event, $25M, or $70M, or some number in between, we're seeing more of that money going to the investors and not payroll.

[mdbdotcom]

Profit doesn't equal cash flow in a business.

source - bizfilings.com

In any event, $25M, or $70M, or some number in between, we're seeing more of that money going to the investors and not payroll.

I wouldn't expect to see any more MASN money go to the Orioles beyond their rights fee. If it did, the Gnats would cry bloody murder, and with good reason. The two teams are supposed to get the same amount, right?

[weams]

source - Accounting for Dummies

source - bizfilings.com

In any event, $25M, or $70M, or some number in between, we're seeing more of that money going to the investors and not payroll.

Yes that is true.

[Can_of_corn]

I wouldn't expect to see any more MASN money go to the Orioles beyond their rights fee. If it did, the Gnats would cry bloody murder, and with good reason. The two teams are supposed to get the same amount, right?

Right, but that isn't the same as ownership putting part of their MASN profits into the club.

[mdbdotcom]

Right, but that isn't the same as ownership putting part of their MASN profits into the club.

Of course it is, unless the profits are distributed to the individual investors who then donate them to the team's operating budget.

[Can_of_corn]

Of course it is, unless the profits are distributed to the individual investors who then donate them to the team's operating budget.

Which is what would be happening.

Ownership is allowed to spend whatever it wants to out of its' own pockets on the team.

[mdbdotcom]

Which is what would be happening.

Ownership is allowed to spend whatever it wants to out of its' own pockets on the team.

Why would an individual investor make an after-tax contribution to the team?

[Can_of_corn]

Why would an individual investor make an after-tax contribution to the team?

Well, Mike Ilitch wants to win a World Series title before he dies. Arte Moreno did it as a long term strategy to raise the value and revenue stream of his club. The Dodgers appear to be a bunch of drunken sailors.

Lots of reasons.

[mdbdotcom]

Well, Mike Ilitch wants to win a World Series title before he dies. Arte Moreno did it as a long term strategy to raise the value and revenue stream of his club. The Dodgers appear to be a bunch of drunken sailors.

Lots of reasons.

I don't think any of those situations has much in common with the MASN situation.

[Can_of_corn]

I don't think any of those situations has much in common with the MASN situation.

PA has spent like a drunken sailor in the past...

[mdbdotcom]

PA has spent like a drunken sailor in the past...

What does that have to do with MASN?

Hypothetically, let's say MASN distributes an additional $10 million to it's investors (which they have to report as income), and then those owners contribute that money to the Orioles to raise the value of the team. The Gnats would go crazy, because that would be MASN skimming money from them to give to the O's.