Record revenue – and expenses
– The Green Bay Packers on Monday reported record revenue — and record expenses — for the year.
The Packers said revenue for the fiscal year, which ended March 31, was $454.9 million, $13.5 million more than last year. Expenses were $420.9 million, a $44.8 million increase.
Packers President and CEO Mark Murphy said increases in player salaries and travel costs, plus a $5 million allowance for construction drove expenses higher. Coaching changes also played a part in the expense increase.
Revenue benefited from additional money from shared national television contracts and growth in local income, largely as a result of new sponsorship agreements.
The Packers are the only fan-owned team in the NFL and the only team to publicly report its finances. The report is the best public information available on the financial aspects of an NFL team.
The Packers have 360,760 owners holding 5.02 million shares. Shares are not traded and they are rarely sold. The last sale was in 2012 to help pay for south end zone expansion. No new sale is contemplated.
The annual shareholders meeting is scheduled for 7 p.m. July 26 at Lambeau Field.
The team reported net income of $38.6 million, $34.2 million less than last year. The previous year’s net income included $27 million worth of relocation fees, split among NFL teams, from the Los Angeles Rams, Los Angeles Chargers and soon-to-be Las Vegas Raiders.
Total revenue, rather than net income, is the more significant number in Packers’ finances because all money, whether profit or not, goes back into team operations or the community. Net income, however, does show how well the team is keeping expenses under control.
Murphy said player expenses tend to be cyclical, rising and falling with new contracts. He said the salary cap was raised by $10 million per team for five consecutive years, which also lead to increased player expenses.
National revenue of $255.9 million was up 4.9 percent. National revenue includes TV deals, road-game revenue sharing and other income, such as from NFL media operations.
Television revenue increases about 5 percent annually and is shared equally among the league’s 32 teams.
Murphy said NFL deals with networks have built-in increases. Also, the NFL maintained short-term contracts on Thursday night games, which allowed it to regularly increase them.
Local revenue, which was $1.6 million higher, includes game-day revenue, local broadcast fees, sponsorships and Lambeau Field Atrium-business income. The latter includes the Packers Pro Shop, the Packers Hall of Fame, stadium tours, 1919 Kitchen & Tap restaurant and atrium rentals.
Tourism-type spending — including Packers Pro Shop, Packers Hall of Fame and Lambeau Field Stadium tours — decreased, primarily because the Packers last year failed to make the NFL playoffs for the first time in nine years.
Celebration of the Packers’ 100th season of football should add to tourismtype spending this year and next, Murphy said. The celebration concludes with the Packers’ 100th anniversary on Aug. 11, 2019.
Titletown District income and expenses are included with the financial report, but the Packers did not break out details.
“We’ve got pretty significant up-front expenses,” Murphy said.
At one time, the Packers acknowledged an investment of $65 million in Titletown District, the business and entertainment district west of the stadium. The number has grown and may be updated in the coming months.
The Packers rank eighth or ninth in the league in total revenue, a position which will be harder to maintain as new stadiums open in Los Angeles and Las Vegas in coming years.
“We are still in the 32nd-sized market in the NFL,” said Paul Baniel, Packers vice president of finance and administration.
A big source of revenue for other teams is stadium naming rights, which Murphy said the Packers will never do.
“That’s why we have gates that are all named,” he said.
Murphy said the stability of the collective bargaining agreement with the players union allowed the Packers to invest heavily in Lambeau Field and the Titletown District. The agreement is in its eighth of 10 years.
“We are hopeful we can reach agreement on an extension,” Murphy said. “I think the agreement has worked well for everyone.”
The team continues to invest in Lambeau Field and the Titletown District. The Packers have invested more money expanding Lambeau Field and building Titletown District in the past decade than the team did in the 2003 Lambeau Field renovation.
“We have some debt related to stadium renovation and expansion, as well as Titletown development. Revenue from current and future years will be more than adequate to pay it off,” said team treasurer Mark McMullen.
This year’s improvements include new stadium lights, new Lambeau Field turf and grow lights, and the beginning of concourse renovation.
The team is adding grab-and-go concessions in the concourses, similar to what would be found in an airport. Murphy said that is expected to shorten lines at standard concession stands and generally have people returning to their seats more quickly.
The plan is to improve the concourse sound system as well.
For the fourth consecutive year, the team added $5 million to the Packers Foundation endowment fund, pushing it over $32 million. The organization’s annual impact, through grants and other projects, exceeded $8 million.
The Packers said last season’s revenue was $454.9 million, $13.5 million more than last year. Expenses were $420.9 million. ASSOCIATED PRESS