O’s: 4th most profitable team in 2022?

[AnythingO's]

OK folks, I have found the latest Forbes numbers for 2022. A few notable changes: Payroll had been about +$20M over Salaries but was +$38M in 2022, also Operating Costs had been about $95M, rose to $102 in 2021 but were up to $114M in 2023. Both those increases eat into profitability (Operating Income) and ultimately maximum Salaries. I have no explanation for those increases.

Year	Revenue	Salaries	Payroll + Expenses	Revenue - Expenses	Operating Income	Operating Cost
2014	245	110	122	123	31.4	91.6
2015	239	118.9	137	102	8.8	93.2
2016	253	147.7	162	91	-2.1	93.1
2017	252	164.3	183	69	-26	95
2018	251	143	161	90	-6.5	96.5
2019	256	61.1	103	153	57	96
2020	115	23.9	43	72	-23	95
2021	251	45.7	66	185	83	102
2022	264	44.88	83	181	67	114

[AnythingO's]

On 3/23/2023 at 3:02 PM, AnythingO's said:

My memory is that only 15-20 voted against the Davis contract but there were likely several polls.

Took awhile to find but 32 voted against the Davis contract. about 22.5% of the total responses.

[Frobby]

6 hours ago, AnythingO's said:

OK folks, I have found the latest Forbes numbers for 2022. A few notable changes: Payroll had been about +$20M over Salaries but was +$38M in 2022, also Operating Costs had been about $95M, rose to $102 in 2021 but were up to $114M in 2023. Both those increases eat into profitability (Operating Income) and ultimately maximum Salaries. I have no explanation for those increases.

Year	Revenue	Salaries	Payroll + Expenses	Revenue - Expenses	Operating Income	Operating Cost
2014	245	110	122	123	31.4	91.6
2015	239	118.9	137	102	8.8	93.2
2016	253	147.7	162	91	-2.1	93.1
2017	252	164.3	183	69	-26	95
2018	251	143	161	90	-6.5	96.5
2019	256	61.1	103	153	57	96
2020	115	23.9	43	72	-23	95
2021	251	45.7	66	185	83	102
2022	264	44.88	83	181	67	114

I don’t really understand this breakout.  Do the salary numbers come from Forbes, or somewhere else?  Is that something different from payroll?  What is “operating cost” compared to “payroll + expenses?”

[Jim'sKid26]

On 3/23/2023 at 4:39 PM, owknows said:

And frankly... a giant cup of coffee would have offered as much performance benefit as either

 

Now you are wading into an area where your knowledge appears to be remarkably limited. 

"It is always better to remain silent and be thought a fool than to speak and to remove all doubt."

[owknows]

42 minutes ago, Jim'sKid26 said:

Now you are wading into an area where your knowledge appears to be remarkably limited. 

"It is always better to remain silent and be thought a fool than to speak and to remove all doubt."

You would of course be incorrect.

[RarityFlaherty]

7 minutes ago, owknows said:

You would of course be incorrect.

 Adderall and caffeine may be very much the same for you, but that’s not how it works for everyone. Drugs affect everyone differently because everyone’s brain chemistry is not the same. 

[AnythingO's]

11 hours ago, Frobby said:

I don’t really understand this breakout.  Do the salary numbers come from Forbes, or somewhere else?  Is that something different from payroll?  What is “operating cost” compared to “payroll + expenses?”

Sorry for the delay, having internet issues. Salaries are public, I think from Spotrac. Forbes gives Revenue, Payroll (salaries plus expenses), and Operating Income (profit). What I call Operating Cost is calculated. We don't know the breakout of what is included in Revenue by Forbes. Basically I take Revenue minus Payroll and Operating Income to generate Operating Cost. Op Cost began rising in 2021, likely the effect of ME changes. The $12M OP Cost jump in 2022 over the $7M jump in 2021 is surprising, maybe a one time thing due to the wall? Payroll includes salaries plus expenses (benefits) but in 2019 the delta over salaries was $42M and in 2022 it was $38M, whereas in other years it has been about $20M. In 2019 I guessed it could be related to the restructure of the Davis contract, I have no idea for 2022's increase.

[Going Underground]

8 minutes ago, AnythingO's said:

Sorry for the delay, having internet issues. Salaries are public, I think from Spotrac. Forbes gives Revenue, Payroll (salaries plus expenses), and Operating Income (profit). What I call Operating Cost is calculated. We don't know the breakout of what is included in Revenue by Forbes. Basically I take Revenue minus Payroll and Operating Income to generate Operating Cost. Op Cost began rising in 2021, likely the effect of ME changes. The $12M OP Cost jump in 2022 over the $7M jump in 2021 is surprising, maybe a one time thing due to the wall? Payroll includes salaries plus expenses (benefits) but in 2019 the delta over salaries was $42M and in 2022 it was $38M, whereas in other years it has been about $20M. In 2019 I guessed it could be related to the restructure of the Davis contract, I have no idea for 2022's increase.

The MSA paid for the wall by reducing what the Orioles rent was and the wall cost 

[Going Underground]

2 minutes ago, Going Underground said:

The MSA paid for the wall by reducing what the Orioles rent was and the wall cost 

Not all in one year.

Camden Yards’ left field wall, by the numbers:

$593,413 waiver to Orioles in rent for construction of new left field wall for 2022 fiscal year

The state owes the Orioles $4.7 million in total rent for the 2022 fiscal year

That’s the amount the Orioles could get to build a $3 million wall after 5 years

[AnythingO's]

Just now, Going Underground said:

The MSA paid for the wall by reducing what the Orioles rent was and the wall cost 

Yes I know that MSA will cover the wall cost thru reimbursement but I think the O's had to pay for the actual construction when done. If so, there is an upfront "cost" that would show up somewhere, that would be reimbursed by MSA. Maybe that is covered in the Revenue increase which is about the same as Op Cost increase???

[AnythingO's]

8 minutes ago, Going Underground said:

The MSA paid for the wall by reducing what the Orioles rent was and the wall cost 

Was the actual wall cost spelled out anywhere?

[seak05]

For most of these things Forbes is taking a guess (this is also true of Forbes celebrity net worth stuff...and well all of the lists that they do).

The truth though is that profit isn't the important number here, and isn't what the owners care about (except when they're negotiating CBA's with the players), it's the value. Cohen can operate at a year to year loss because the overall value of the Mets is increasing, so he's making a profit on the investment. It's also though why you need an owner with liquid cash assets, so they can spend based on the value increases rather then having to rely on year to year profit. 

[AnythingO's]

24 minutes ago, AnythingO's said:

Was the actual wall cost spelled out anywhere?

Found this so "wall cost" and reimbursement doesn't account for the Revenue or the Operating Cost increases.

The stadium authority recommended the Orioles receive a discount of one-fifth of the wall’s total cost per fiscal year from 2022 to 2026, up to $700,000, depending on the project’s cost, provided the Orioles extend the lease or sign a new one. The Orioles will receive the $593,413 discount annually for the next four fiscal years, as long as a lease is agreed to.

[Jim'sKid26]

1 hour ago, owknows said:

You would of course be incorrect.

Now I'm intrigued @owknows. Please enlighten us all. Perhaps I have completely underestimated your knowledge of the performance enhancing properties of stimulants and their application in professional sports. Whatcha got?

Edited March 26, 2023 by Jim'sKid26

[Aristotelian]

19 hours ago, AnythingO's said:

OK folks, I have found the latest Forbes numbers for 2022. A few notable changes: Payroll had been about +$20M over Salaries but was +$38M in 2022, also Operating Costs had been about $95M, rose to $102 in 2021 but were up to $114M in 2023. Both those increases eat into profitability (Operating Income) and ultimately maximum Salaries. I have no explanation for those increases.

Year	Revenue	Salaries	Payroll + Expenses	Revenue - Expenses	Operating Income	Operating Cost
2014	245	110	122	123	31.4	91.6
2015	239	118.9	137	102	8.8	93.2
2016	253	147.7	162	91	-2.1	93.1
2017	252	164.3	183	69	-26	95
2018	251	143	161	90	-6.5	96.5
2019	256	61.1	103	153	57	96
2020	115	23.9	43	72	-23	95
2021	251	45.7	66	185	83	102
2022	264	44.88	83	181	67	114

So operating income is the overall income net of everything? So it does appear the Orioles have banked profits from the profitable years to operate at a loss in the high payroll years, but only to an extent (most notably in the red by 26M in 2017).

It definitely looks like the profits are far bigger than the losses overall. If you ignore 2020, I'm getting $247M profits in the profitable years vs -$34M in the negative years. Definitely appears there is plenty of room to increase payroll and still operate at an annual profit, and even more so if you bank a portion of the profits during the rebuild.