Packers set revenue record, but profits fall
Milwaukee Journal Sentinel
GREEN BAY--The Green Bay Packers had record revenue last year, but increases in player costs and depreciation on improvements to Lambeau Field reduced the franchise’s net profit sharply, according to financial records released Thursday.
Team revenue for the fiscal year ending March 31 was $324.1 million, $16 million more than last year. Net income, however, dropped from $43.1 million to $25.3 million, a $17.8 million or 41 percent drop.
Total expenses jumped from $253.8 million to $298.5 million, a 17.6 percent increase.
Mark Murphy, the franchise’s president and CEO, attributed part of the drop in net income to the timing of player contracts, including such stars as linebacker Clay Matthews (under contract through 2018) and quarterback Aaron Rodgers (under contract through 2019). Those contracts showed up on the financial books last year instead of the previous fiscal year.
Player costs, which include benefits, went up $35 million from $136 million to $171 million.
The other big cost consideration that affected net income was depreciation on the improvements made at Lambeau Field, including the $146 million, 7,000-seat expansion of the south-end zone area and the $166 million renovation of the Atrium. The Atrium renovation will not be fully completed until next season.
“We had depreciation of about $8 million that we hadn’t had in the previous year,” Murphy said.
Murphy said anticipation in the coming season was high.
“People have good hopes we can do well,” he said. To that end, Murphy said it was a top priority for him to extend the contract of general manager Ted Thompson, which runs through the 2016 NFL draft.
“I think Ted has been instrumental, obviously ... in the run we’ve had,” Murphy said. “So that is a real priority.”
Murphy added that Thompson, who took over as general manager in 2005 and holds the title of executive vice president, general manager and director of football operations, had not given any indication that he would resign.
He said the franchise’s goal was to “give Ted and everybody in football the resources to remain competitive.”
Profit from operations totaled $25.6 million, a drop of $28.8 million. National revenue, which includes national television revenue, was up $7.8 million, to $187.7 million, and local revenue from stadium operations was up $8.2 million, to $136.4 million.
Also, the franchise’s corporate reserve fund, maintained for emergencies as a kind of insurance policy, grew from $254 million to $284 million.
Murphy credited the National Football League’s 10-year collective bargaining agreement, now in its third year, for giving the Packers and other franchises financial stability.
“Stability helps us. The financing that is now available for renovations such as ours have has been helpful,” Murphy said. He said nearly half of the teams in the league had taken advantage of the league’s lending program for stadium renovations.
The big change this coming season will be the opening of a larger Pro Shop and a larger Harlan Plaza and east-gate entrance. Next season, the new and larger Packer Hall of Fame will open.
Murphy also elaborated on the Packers’ plans for the future for land it now owns west and south of Lambeau Field. Long-term, the franchise plans to call the development Titletown.
“In the coming years, you will see changes there,” Murphy said. “We have looked at a number of different things in and around the stadium that will be improvements that will help the organization, the fan experience and the local community.”
Murphy said land owned by the Packers west of the stadium would be targeted for development, while land now owned by the franchise south of the stadium would be used for stadium operations and possible football operations.
An undetermined number of homes to the south that are adjacent to the stadium have been razed. That property will be used for parking this season.
Murphy also said a soon-to-be-closed K-Mart on Lombardi Ave. could be razed in time to allow for more parking near the stadium.
Murphy also discussed the cost of ticket prices to Packers games. He said the Packers rank 17th in the league in ticket price cost.
“I guess we’ve always tried to be right at the average,” he said. “Just below the average now. We want to be affordable and we want people to bring their families. But we operate in the context of the league. We want to be fair to the other teams through the visiting team share. We struck that balance.”