Off Topic
Final Season P/L Tables
”Abercrombie G. Findley” wrote: October 19, 2057
From the Offices of Finance
Bikini Krill Management Team
RE: Overview of Financial Histories and Positions
To Whomever It Concerns.
This report is written with intent to reveal and document the successes and failures of financial activities made by the team this past season. As we will recall, the 2056 season spent in Seatle was one massive bloodbath when it came to the balances of accounts receivable and accounts payable. The acquisition of the franchise by Mr. Westmoreland had certain benefits, but his view that the club needed to stand alone was made clear from the beginning. As such, the team took several actions over the course of the season, the results of which are documented here for eternity.
This report will be made in sections that compare season over season status, starting with:
Season Budgets & Starting Balances
Commentary: It is noteworthy that the franchise started with a budget of $112m each season. In other words, Westy did not suddenly loosen the purse strings. That said, the team had just over $2.5m in hand at the beginning of 2056, but due to what could be considered extravagant spending (which we will get to in the proper section), the team that moved to Bikini began the season almost $12m in the red.
2056 2057 Budget $112,000,000 $112,000,000 Starting Balance $2,572,180 -$11,866,464
Cutting to the chase, the good news here is that the actions that are documented in this report have resulted in a 2058 starting position that is projected to include a $116m budget, and a $7m account of working capital. Off season moves can, of course, change both of these line items, but as stands now, the 2057 season has been an outstandings success in the pocketbook.
Sources of Revenue
Commentary: Despite increased gate receipts both home and away, the franchise’s revenue decreased by almost $2m year over year. This comes due to a smaller Media deal (presumably due to the crashed fan engagement in the final season in Seattle), and likewise a $3m loss in season ticket receipts. There are mitigating factors to these aspects, however.
REVENUE SOURCE 2056 2057 Season Tickets $15,213,744 $12,165,309 Gate (Home) $8,759,271 $10,501,131 Gate (away) $14,689,678 $15,192,453 MEDIA $68,000,000 $67,000,000 Merchandising $5,194,233 $5,294,344 $111,856,926 $110,153,237
Season Ticket Sales: While in Seattle, the club’s ticket prices were traditionally set at $28 per ducat, regardless of the year or situation. This is considerably higher than league average, and served the franchise well enough when it was winning. Alas, the franchise had not won for over a decade. The Storm sold 6,708 season tickets in 2056, and averaged just better than 13,000 fans per game in attendance. New management slashed season tickets to $13. This had the effect of immediately dropping overall revenue, but increasing pre-season sales by almost 100%. 11,553 season tickets were sold. In the meantime, fan energy increased.
Season Gate Receipts: Walk-up gate revenue increased both home and away (by roughly $2.2m combined), suggesting the interest in the team was high. A secondary affect was that merchandising receipts also increased by roughly 2%. This despite the team playing baseball badly enough that they actually tied the Hawaii franchise for worst record in the best division in baseball.
Season Gate Receipts: The reduced media contract for 2057 has already been highlighted. This hamstrung the team a small amount. The good news here is that the team has already inked a $71 million deal with a Forever Land Media to broadcast games next year. This represents a $3m value increase (that helped buoy the team’s projected budget).
Ledger of Expenses
Commentary: The franchise’s overall spending dropped by $21m in 2057, with increases in Staff salaries and “miscellaneous” expenses offset by drastic reduction in player payroll. The release of Alexader Julyan represents a bulk of overage in “Miscellaneous” spending.
EXPENSES: 2056 2057 Players $108,167,423 $80,347,556 Staff $7,729,999 $8,829,938 Draft $8,845,000 $8,700,000 Miscellaneous $1,376,543 $7,388,889 $126,118,965 $105,266,383
Player Spending: Payroll reductions came in the form of aggressively trading or (often) selling players on larger contracts. Some of these trades were made at the cost of retaining salaries, so the overall effective payroll of players actively on the team was often quite a bit lower than the books show. It’s noted that this line item includes several hundred-thousands of dollars given to popular players who were inked to various personal appearance contracts toward the end of the season—an act that helped the team sell tickets throughout the season.
Staff Salaries: The Krill turned over large parts (85%?) of their coaching staff throughout much of 2057. This resulted in spending increasing by $1m. Much of that was in buying out contracts, and then replacing the individuals. Spending on staff is currently projected to drop by $3m in 2058
Draft Signing Bonuses: By design, draft expenses remained essentially steady.
Operating Profit
Commentary: As noted elsewhere and before, 2056 was a full-fledged financial disaster, resulting in an operating loss of $14.4m, nearly $12m of which was retained as debt on the ledger to begin the 2057 season with.
2056 2057 PROFIT/LOSS -$14,442,039 $4,896,854
Cost containment steps, and appealing to baser fan instincts in 2057, however, resulted in both five extra wins for the club, but also in $4m in additional profit margin.
Final Ledger
2056 2057 ADDED CASH Trades $0 $8,175,000 Other/Misc $0 $6,437,500 FINAL BALANCE -$11,866,464 $7,632,892
Commentary: Through a series of trades, fire sales, and giveaways, the Krill management added over $8m to the register. In addition, the team’s miscellaneous income grew when front office took an equity loan from its own bonus cash, as well as created $4m from expenditure of PPT. The combined $14.6m in receipts, when combined with the overall net operating profit of $4m, erased the team’s debt and returned instead $8M to the bottom cash line. Not a bad situation overall.
A season’s end, it appears that the team have removed all debt from the registers.
Final Summary
As noted above, though the team won only 61 games in 2057 (a five game increase!), financially the season was a great success. Here's to more progress in 2058.
Coordially,
Abercrombie G. Findley
Bikini Krill Finance Team
