Braves are off to strong start financially in 2022
Despite an MLB lockout that delayed and shortened spring training and kept the regular season from starting at its originally scheduled date, the Atlanta Braves posted an increase in revenue for the first quarter of this year, according to financial results disclosed Friday by team owner Liberty Media.
The Braves had revenue of $23 million in the quarter covering January through March, up 44% from $16 million in the same period in 2021, the company said.
Although the first-quarter results don’t include any regular-season games, Liberty Media CEO Greg Maffei said on a conference call with investment analysts Friday that business has been strong since the season began April 7.
“While it’s still early in the season, financial performance has already been incredible,” Maffei said. “Going into the season, we had the highest season ticket sales in more than two decades, sold out all of our multiyear premium seats for the first time ever. … Retail and concession sales have been strong for the first (two) homestands.”
Less impressive so far, of course, has been the reigning World Series champions’ performance on the field. The Braves have just one series win this season — they took two of three games against the visiting Chicago Cubs in late April — and they fell to 12-16 with Friday’s home loss to start a three-game set against the Milwaukee Brewers.
That started an eight-game homestand after back-to-back road series against the Texas Rangers (Atlanta lost two of three in Arlington) and the New York Mets (each team won twice), who lead the National League East Division where the Braves are the reigning fourtime champs.
“We’ve completed less than 20% of the season. It’s a long way to go, and last season showed how far things can change over this 162 games,” Maffei said. “We are hovering at around the same record as last year (at this point), and we all know how that turned out. At least we did manage a split with the Mets.”
Of the Braves’ $23 million in first-quarter revenue, Liberty Media said $11 million came from baseball sources (up from $7 million in the same period last year) and $12 million from The Battery Atlanta mixed-use development (up from $9 million in the same period last year). In 2021, the Braves were still dealing with attendance being limited by COVID-19 restrictions.
“Baseball revenue increased in the first quarter due to increased capacity at spring training games, additional special events held at the ballpark, World Series-related retail revenue and an increase in licensing revenue,” Liberty Media said. “(The Battery) revenue increased during the first quarter due to a reduction in deferred payment arrangements and increases in rental income from various new lease commencements.”
Because MLB teams generate the vast majority of their revenue and profits in the second and third quarters each year, the Braves typically show large operating losses for the first quarter. That again was the case, with Braves Holdings reporting an operating loss before depreciation and amortization (OIBDA) of $17 million in this year’s first quarter, compared with an OIBDA loss of $20 million in the same period last year. After depreciation and amortization, the Braves showed an operating loss of $37 million in the first quarter of both 2021 and 2022.
The Braves are one of the few sports franchises with publicly traded stock. That requires the quarterly disclosure of financial information that other teams keep secret.
Maffei was asked on Friday’s conference call about why Liberty Media hasn’t sought to increase the Braves’ stock market value by spinning off the team into a stand-alone publicly traded company, which potentially could facilitate an eventual sale down the road, rather than sticking with the current complicated tracking-stock model.
“I think we’re looking at all options and considering what we might do,” Maffei said. “We evaluate all opportunities. … I do agree that probably having the flexibility to do that would probably improve trading over time.”
Liberty Media disclosed that the Braves’ debt decreased $22 million from $700 million as of Dec. 31 to $678 million on March 31. The debt stems mostly from the construction of Truist Park, The Battery Atlanta and a spring-training facility in North Port, Florida.
Liberty noted that the second phase of The Battery is expected to be completed in the second quarter of this year and that construction is expected to begin in the second half of the year on an additional office building that will house the national headquarters of Truist Securities under a 15-year lease.
On another topic: Maffei, who previously expressed skepticism about including Braves telecasts on a new direct-to-consumer streaming service being launched by the owner of Bally Sports, didn’t signal a change of position when asked about that issue Friday, saying “I don’t know if Bally is going to be the lead player” in streaming games.
“They’ve got their challenges,” Maffei added. “But we’re certainly open to watching how the market evolves.”