The Green Bay Packers posted another year of record revenue and profit, the team revealed on Tuesday in a sneak preview of next week’s annual shareholders meeting.
In fiscal 2012, the Packers set records with local revenue of $130.4 million, total revenue of $302 million, profit from operations of $43 million and net income of $42.7 million. In fiscal 2013, the club improved upon most of those marks with total revenue of $308.1 million, profit from operations of a staggering $54.3 million (a 26.4 percent increase) and net income of $43.1 million. The only number that dropped was local revenue, with the shine from a Super Bowl championship wearing off and sending that number down a bit to $128.2 million.
Packers President/CEO Mark Murphy called it “another strong year,” pointing to the second full year of the collective bargaining agreement as a major factor.
“I think we’re seeing the benefits of that,” Murphy said. “One of the main benefits is just having the stability of a long-term labor agreement. It’s allowed the league to enter into long-term contracts with our television partners, long-term agreements with sponsors. Same thing for us. We’ve been allowed to enter into long-term agreements with our gate sponsors, which has really been helpful. With the financial situation that we’re in now, we’re able to invest in the team.”
Those investments include megabucks deals with Aaron Rodgers and Clay Matthews, along with the addition of 7,000 seats in the south end zone and an ongoing renovation of the atrium.
“We’re trying to set the organization up to continue to be successful into the future and to provide financial stability,” Murphy said.
Helping the bottom line was a $5.2 million reduction in total expenses. The key to that was a $19 million reduction in player costs, from $155.4 million in 2012 to “almost” $136 million in 2013.
“We’re already above last year’s level,” Murphy said because of the blockbuster extensions.
Rodgers received a $35 million signing bonus and Matthews pocketed a $20.5 million signing bonus. Those bonuses are pro-rated for the salary cap, and it’s no different for team accounting. The Packers spread out Rodgers’ bonus from 2013 through 2017, even though he’s under contract through 2019. So, his bonus will add $7 million to player expenses over the next five years. Matthews’ bonus was pro-rated from 2013 through 2017, as well, even though he’s under contract through 2018. So, his bonus will add $4.1 million to player expenses over the next five years.
“It’s really a timing issue,” Murphy said. “If those had fallen in our fiscal-year, our expenses would have been different. They’re going to be in the next fiscal-year, so I anticipate we’ll have some differences there. Because of the timing, our profits are probably a little higher than they would have been otherwise.”
While player expenses will be up for next fiscal-year, so, too, will revenue. The latest Lambeau Field addition will push capacity to 80,750 — ranking behind only New York and Washington. That will bring in about $8 million per season in combined tickets and concessions — though ticket proceeds (but not suites) are split 60/40 with the visiting team and there will be costs with the added staff. Another $2 million is coming from additional sponsorships in the south end zone. Plus, the new Cabela’s outdoors store will open next week on property owned by the Packers, so the team will begin collecting “rent” at that point.
— National revenue increased from $171.6 million to $179.9 million. The increase stems from the league’s deal with Nike and NFL Network being added to Time Warner Cable and Cablevision.
— The team ranked 10th in total revenue last fiscal-year. An updated ranking won’t be available until October.
— Net income increased by $400,000 even while profit from operations increased by $11.4 million. Why? “We did some repositioning in the portfolio a year ago and we had some extra gains a year ago,” vice president of finance Paul Baniel said. “If you take your 401(k) and move it from one fund to another, you take an unrealized gain, then all of a sudden you realize it. That’s the kind of thing that occurred a year ago.”
— The Packers Preservation Fund, which had stood at $127.5 million for the past few seasons, is essentially a thing of the past. That’s been rolled into a corporate reserve fund, which increased in worth from $246 million to $254 million.
— The team donated more than $6 million to charities. “We anticipate that will grow significantly in the future,” Murphy said. “We’ve made a big commitment to our foundation. This year, we made a donation to the foundation of $5 million.”
— The team, like all the others, contributed $2 million to health and safety research.
— Cell phone service will be vastly improved but the team is struggling with ways to improve its wireless presence, since the bowl configuration doesn’t lend to obvious places to put towers.
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Bill Huber is publisher of Packer Report magazine and PackerReport.com and has written for Packer Report since 1997. E-mail him at firstname.lastname@example.org, or leave him a question in Packer Report’s subscribers-only Packers Pro Club forum. Find Bill on Twitter at twitter.com/PackerReport.