As I noted many months ago, the Washington Capitals were experiencing strong growth in revenues and in attendance. That is the good news.
BUT we have grown our payroll and related expenses faster than we have grown our revenues so we will LOSE more money this season than we did last season. And that loss will be way more than $5 million for the year.
But there is good news. We can’t grow our payroll anymore. We are at the cap max basically so any additional revenue growth cuts into the losses. The business model is not fixed but it has improved dramatically with the new CBA for us in DC. Thanks to our fans but we have miles to go before we sleep. I would be celebrating if we lost $5 million this year on our hockey team. That would mean we would have won a Stanley Cup in four 7 game series. :-) Even then, I bet our loss would be more than $5 million.
Tags: Hockey, NHL, Ted Leonsis, Ted's Take, Washington Capitals
[...] See owner Ted Leonsis’s blog post discussing, in more detail, the Capitals’ financial situation here.] Possibly related posts: (automatically generated)A test of depth tonightSome hockey poolies [...]
And here I was hoping I’d find a job with you this year.
Sorry you’ll still be losing money … but it is sooo great to see so many more people in seats for gmaes (especially the mid level that was EMPTY last year).
the ice girls . . . unnecessary
So what has to happen for the team to cut a profit, outside of a bigger national TV deal?
Seems to me the problem for the Caps and NHL is poor TV/Radio contracts. That keeps the revenue avenues down but it sure is nice to see the fan support for the Caps.
it sucks that despite making real gains in fan attendance, excitement, a huge jump in viewership, etc that you’re still expecting to lose money! But if its worth anything we (the fans) really appreciate the amount of dedication you’ve shown into building this hockey team. Its a great time to be a caps fan!
Someone is certainly saving money on the beer cups..Those things are one step above paper cups. Can I bring my own mug?
I thought the salary cap is tied into revenue? I don’t understand how a team that has such great attendance can lose money. It doesn’t look like the cap is helping much.
Also, it looks like you’ll be paying more than the cap because of all the injuries. Just because a player is on LTIR (Pothier, Clark, Shultz) and it doesn’t count against the cap, you still need to pay the player.
We are so lucky to have an owner that puts the team first and does whatever it takes to put a great team on the ice. Thank you!! I hope you start making money in the near future. You deserve it.
The way to get the revenue to increase is to keep doing what you’ve been doing. Just win. The fans will come. The place was loud and rocking last night, and there weren’t too many empty seats.
Keep on winning… that’ll get people out. Or maybe we need a larger arena? Remember, Abe built all of the arenas for his basketball team. The Caps were always an afterthought.
Another way to increase seats, is to get the lease changed so that the Caps can sell the seats on the 200 level. That those seats are sold by someone else to view your product is wrong…
I am sure that during the run up to the playoffs last year and during the playoffs, the Caps could have sold 20,000 seats if they had them.
I have a feeling it has more to do with the money situation the caps are in in relation to the Wizards. Please, Ted, correct me if I’m wrong. Abe owns Wiz and arena, and receives all monies from Concession sales, right? I’d be willing to be the Caps generate more than 5 mil/year in concession sales.
I also believe that all luxary box proceeds go to Wiz, none to the Caps. And lastly, it’s part of the reason we can’t get a decent sheet of ice for our team to play on. How many groin injuries will we suffer before we set the thermostat in the arena to 50 degrees?
[...] with his idea, especially Washington owner Ted Leonsis. The fan friendly team chairman recently mentioned in his blog that even if the Caps run the table in the playoffs and have a seven game Stanley Cup Final Series, [...]