Less than a year after filing for bankruptcy and being
purchased by Mario Lemieux, the Penguins announced yesterday
that they "broke even in operating expenses" this season,
according to Dejan Kovacevic of the PITTSBURGH POST-GAZETTE.
A "beaming" Lemieux said at a press conference yesterday,
"This past year, the organization has made a lot of
progress, on and off the ice. I'm very proud." The team
lost $13M in operating expenses in '98-99 and projected to
lose between $2-3M overall this season, but Penguins COO Ken
Sawyer said the team "managed to make ends meet" after
controlling costs. However, the "break-even figure" does
not include the $2-3M the Penguins paid in debt service,
"which prevented Lemieux and any of his investors from
seeing any return on the money they invested last summer."
Factors that contributed to the team's "improved financial
picture" included a 4.1% increase in average attendance
during the regular season to 15,517, five home playoff games
that earned an additional $2M for the team and lucrative
sponsorship deals with Mellon Bank, UPMC and Giant Eagle.
Lemieux said that he is "no longer seeking additional
investors for his ownership group" because he has "obtained
the extra funding he had been seeking throughout the winter
from within his current group." In other news, Penguins
ticket prices will rise "slightly" next season and the team
has signed a multiyear deal with ACS Sports.com to maintain
its Web site (POST-GAZETTE, 5/16). Also in Pittsburgh, Joe
Starkey writes that the Penguins "expect to make more than"
$3M next season, due in part to expansion fees from the Wild
and Blue Jackets. Sawyer said the team "still carries" $38M
in debt -- mostly due to banks and insurance companies --
but he added that the team is in solid "financial shape."
Sawyer: "We have a lot of capital relative to our debt."
Starkey: "It's been a while since that statement could apply
to this franchise" (Pittsburgh TRIBUNE-REVIEW, 5/16).
NEW ARENA UPDATE: The Penguins are expected to receive
a report on the projected size and cost of a new Pittsburgh
arena next month. The Penguins paid PricewaterhouseCoopers
$80,000 to study the area's economy and demographics to
determine how many regular seats, premium seats, luxury
boxes, concession areas and retail stores a new arena should
contain (PITTSBURGH POST-GAZETTE, 5/16).
