“The business is probably losing between $18-20 million a day and the players are losing $8-10 million a day. I don’t think it’s realistic for anyone to expect the economic deal to get any better.”
…………..Commissioner Gary Bettman –On Day 67 of NHL Lockout
Forbes Magazine helpfully informs us that the combination of Toronto, Canadiens and the New York Rangers annually generate fifty percent of the total operating revenue for the entire league. While there are no Roman Hamrlik’s on the ownership side of the process due to the Bettman gag order, I can’t imagine there’s lockout frenzy in the sixth floor Bell Centre offices of the Canadiens.
Tomorrow (Friday) the league will be officially removing all games up to and including December 15th from the schedule. For the Canadiens it means a total of seventeen regular season home games off the season plus 5 more from pre-season will be gone, never to be replaced.
The financial damage to the Canadiens is considerable. At an average ticket price of 90 dollars, the 21,273 fans for every sellout crowd amounts to 1.91 million dollars per game.
Do the math. Twenty-two lost games (including training camp) multiplied-by 1.91 million dollars adds up to 42 million in season gross revenue. To get to a bottom line, we have to deduct basic operating expenses from that, including what will be the 50 percent slice of hockey-related-revenues the players will be getting when the CBA is finally signed.
The last time Forbes Magazine did it’s survey of NHL finances they covered the 2010-2011 season. That season, they estimated the Canadiens bottom line after expenses was 47.7 million dollars operating revenue or in financial circles, something called EBITDA, the acronym standing for “Earnings Before Interest, Taxes, Depreciation and Amortization”.
The Canadiens played 47 dates at the Bell Centre in 2011-2012 (including six sold out exhibition games) which meant just over a million dollars per game in operating income.
Translate that to 22 home games lost this season and you can understand why the lockout enthusiasm of Geoff Molson and his partners is somewhat curbed.
Of course, there are eighteen or twenty franchises who are feeling no financial pain at all because they operate on the line or in the red every year. These franchises are setting the lockout agenda from the ownership side.