MASN: the veil finally lifts

[Going Underground]

7 hours ago, TonySoprano said:

$72.58M

Since these numbers were hidden it makes me wonder what did Forbes use in their valuations of profit/loss.  Along those lines, the Orioles may have been more profitable than some surmised.

At least Angelos and the boys were very profitable. Baltimore Orioles,Limited Partnership is almost totally owned by  the Angelos family. I don't think Forbes used the LP since it is a somewhat separate entity. Still think last year was probably if not the most profitable year in Angelos ownership reign. Payroll was the lowest since 2004. The revenue sharing per team was $209 million. The way MASN revenue percentage is distributed by team  might have went down slightly but the revenue sharing has never been higher.Owning  most of a two team regional network might be more profitable then not having the Nationals in the area but you would need to see some of the other revenue streams we can't see. 

[accinfo]

Thanks Frobby for this.  Very interesting.  I would be shocked if the Sun doesn't pick up on this information.

[Frobby]

7 hours ago, TonySoprano said:

$72.58M

Since these numbers were hidden it makes me wonder what did Forbes use in their valuations of profit/loss.  Along those lines, the Orioles may have been more profitable than some surmised.

I previously was under the impression that Forbes’ numbers excluded ownership and dividends from RSN’s, but did include the rights fees.    I thought I’d read that somewhere in one of Forbes’ prior valuation reports, but I see no reference to it this year so I’m not sure where I got that.   

[Going Underground]

8 minutes ago, Frobby said:

I previously was under the impression that Forbes’ numbers excluded ownership and dividends from RSN’s, but did include the rights fees.    I thought I’d read that somewhere in one of Forbes’ prior valuation reports, but I see no reference to it this year so I’m not sure where I got that.   

This was mentioned .

https://www.forbes.com › sites › mikeozanian › 2019/04/10 › baseball-tea...

1.  

 

 

We also do not include the equity value of team-owned regional sports networks. The league’s ownership in Major League Baseball Advanced Media (100%), BamTech (15%), the MLB Network (67%) and league’s investment portfolio are included in our values, equally divided among the 30 teams. These three assets constitute over $400 million in value per team.

[Frobby]

2 minutes ago, Going Underground said:

This was mentioned .

https://www.forbes.com › sites › mikeozanian › 2019/04/10 › baseball-tea...

1.  

 

 

We also do not include the equity value of team-owned regional sports networks. The league’s ownership in Major League Baseball Advanced Media (100%), BamTech (15%), the MLB Network (67%) and league’s investment portfolio are included in our values, equally divided among the 30 teams. These three assets constitute over $400 million in value per team.

OK, so I was right.    I assume Forbes’ numbers (1) have included the rights fees actually paid, rather than what the RSDC has ordered to be paid, and (2) don’t include the MASN profit distributions, which will be much lower if the RSDC decision is upheld.   

[Going Underground]

16 minutes ago, Frobby said:

I previously was under the impression that Forbes’ numbers excluded ownership and dividends from RSN’s, but did include the rights fees.    I thought I’d read that somewhere in one of Forbes’ prior valuation reports, but I see no reference to it this year so I’m not sure where I got that.   

Thanks for all the work you did.   Be interesting to see if Jeff  Barker from the Sun ,who does alot of the MASN and other Oriole economic news picks up on this. Don't expect MASN to say much .

[Frobby]

1 minute ago, Going Underground said:

Thanks for all the work you did.   Be interesting to see if Peter Barker from the Sun ,who does alot of the MASN and other Oriole economic news picks up on this. Don't expect MASN to say much .

Honestly, you’d have to be paying super close attention.    You’d have to read the oral argument transcript from the other day, notice a reference to a couple of obscure numbers deep into the argument, go back and look at the pages of the RSDC decision mentioned in the argument and plug those numbers in where they had been redacted, and then do a little math.     I won’t be surprised if no reporters pick up on it, unless they read it here.   

[DrungoHazewood]

Currently Forbes says the Orioles generate $251M of revenue a year, and had an operating loss of $6.5M in 2018.  $70M-ish from MASN (if the numbers from 2012-16 are still valid for 2019).  $42M from gate receipts.  That's not even halfway there.  What's the rest?  Advertising.  Cut of the concessions.  Cut of merchandising.  Revenue sharing.  MLBAM.  Parking.  

[Frobby]

12 minutes ago, DrungoHazewood said:

Currently Forbes says the Orioles generate $251M of revenue a year, and had an operating loss of $6.5M in 2018.  $70M-ish from MASN (if the numbers from 2012-16 are still valid for 2019).  $42M from gate receipts.  That's not even halfway there.  What's the rest?  Advertising.  Cut of the concessions.  Cut of merchandising.  Revenue sharing.  MLBAM.  Parking.  

Per BB-ref, teams pool 48% of local revenue and share it equally, amounting to $118 mm per team in 2018.    They also share national revenue equally, amounting to $91 mm per team in 2018.     So, that’s $209 mm that every team gets.     Of course, they also have to throw their 48% of local revenue into the pot.    https://www.baseball-reference.com/bullpen/Revenue_sharing

[TonySoprano]

1 hour ago, Frobby said:

Honestly, you’d have to be paying super close attention.    You’d have to read the oral argument transcript from the other day, notice a reference to a couple of obscure numbers deep into the argument, go back and look at the pages of the RSDC decision mentioned in the argument and plug those numbers in where they had been redacted, and then do a little math.     I won’t be surprised if no reporters pick up on it, unless they read it here.   

They have no incentive to do any reporting on this.  Quite frankly, they would rather keep the public in the dark about the team's finances.   The perception is already out there that ownership is being cheap again.

[Frobby]

3 minutes ago, TonySoprano said:

They have no incentive to do any reporting on this.  Quite frankly, they would rather keep the public in the dark about the team's finances.   The perception is already out there that ownership is being cheap again.

We certainly won’t see MASN’s reporters getting into it.    Someone from Baltimore Business Journal might, I suppose.   

[charmcitydeac]

What about the economics for the current five-year window (2017-2021)?  Do we know if the O's and Nats are in agreement on how that money is being distributed?  Will we have to go through this every five years?  

[mdoriolefan]

Scene from the warehouse when news broke that the numbers have been revealed.

[DrungoHazewood]

41 minutes ago, Frobby said:

Per BB-ref, teams pool 48% of local revenue and share it equally, amounting to $118 mm per team in 2018.    They also share national revenue equally, amounting to $91 mm per team in 2018.     So, that’s $209 mm that every team gets.     Of course, they also have to throw their 48% of local revenue into the pot.    https://www.baseball-reference.com/bullpen/Revenue_sharing

So if I understand this correctly, they got 70+42 = 112M or so in MASN and ticket revenues.  48% of that is $54M, they keep $58M.  So $209M in shared revenues plus 58M = $267M.  That doesn't include advertising, concessions, parking, random other stuff (I don't think Forbes counts any of that in gate receipts).  Even if those things are pretty trivial it looks like Forbes is under-counting Orioles revenues by $30M or more.  And I'm no accountant, but that $6.5M operating loss should be more like a $25M profit, right?  

And that's based mostly on 2018 numbers, before they cut payroll significantly.  But also before they lost a 264k in attendance, but attendance revenues probably only declined $7M from 2018-19 (roughly $27 per ticket).

[LookinUp]

All interesting.

I'm not sure how payment would work, but the O's apparently have a $70 million check to write. Makes sense that they'd be cutting costs right now.