SBD Global/November 7, 2012/Finance

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  • Germany's Pro Sports Leagues Generate Combined $452.7M, Highest In Five Years

    The German Hockey League regained its position as Germany's most-profitable arena sports league.

    Germany's professional sports leagues have generated their highest combined revenue in the last five years during the '11-12 season. This is the result of a Deloitte study called "Finanzreport deutscher Profisportligen [Financial ReportGerman Professional Sports Leagues]," which takes a look at profitability of the Basketball Bundesliga (BBL), German Hockey League (DEL), Handball Bundesliga (HLD) and the 3rd League in football. In addition, for the first time the annual study also includes the Austrian and Swiss top-flight football leagues. The BBL, DEL, HBL and 3rd League generated a combined revenue of €353.6M ($452.7M) in '11-12, which is an increase of 3.2%. The driving force behind this growth is the BBL, which increased its revenue by 26.3%, and profited from the promotion of Bayern Munich. Deloitte Senior Consultant Stefanie Vogel said, "The competition between the leagues regarding fans, TV presence and sponsors is bigger than ever before. It will be interesting to see if the recently finalized agreement between public broadcasters ARD and ZDF and the league trio DEL, HBL and BBL about increased coverage of the leagues can provide them with new growth potential." The 18 BBL clubs were able to increase their revenue by more than one fourth during the '11-12 season, which resulted in combined record-revenue of €76.9M ($98.4M). The BBL was also able to increase its average attendance to 4,422 per game. In addition, the DEL and HBL were also able to increase their revenues by 8.8% and 2%, respectively. The handball league generated its best-ever result with a revenue of €86.1M ($110.2M). However, the HBL was unable to duplicate its annual growth rate over the past several years of 9.5%. As a result, the HBL lost its position as the most-profitable arena sports league to the DEL. The hockey league generated a revenue of €86.2M ($110.3M). The 3rd League generated the best result of all surveyed professional leagues in Germany with a revenue of €104.4M ($133.6M). At the same time, the 3rd League was the only league that suffered a revenue decrease of 11.5%. The report also took a look at the top football leagues in Austria and Switzerland. The Austrian tipp3-Bundesliga generated €155.1M ($199M) in revenue, while the Swiss Raiffeisen Super League generated €171.3M ($219.2M). The results of both leagues are considerably above Germany's 3rd League (Deloitte).

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  • Nike Finalizing $500M Sale Of Cole Haan To Equity Firm Apax Partners

    Nike is in “final negotiations to sell its Cole Haan handbag and shoe brand to private equity firm Apax Partners, in a deal that could fetch around $500 million,” according to sources cited by Kim & Oran of REUTERS. Sources said that London-based Apax has “teamed up with former Converse CEO Jack Boys to help run Cole Haan after a takeover.” Nike in May said that it was “looking to sell Cole Haan and soccer gear unit Umbro and announced a $225 million deal last month to sell Umbro to Iconix Brand Group” (REUTERS, 11/5). USA TODAY’s Peter Lattman noted among Cole Haan’s “best-selling lines are its Maria Sharapova signature ballet flats,” which Sharapova “helped design.” It was unclear “whether an independent Cole Haan would continue to use Nike’s air-cushion technology.” But if it did, Cole Haan “would probably have to pay its former parent a licensing fee” (USA TODAY, 11/6). In London, David Gelles noted that Nike bought Cole Haan for about $90M in '88. During that time it has made the brand "one of the best known" American shoe names. However, in recent years customers have "begun to complain on shopping websites about its deteriorating quality." The company’s "diminished reputation will pose a test for Apax, which will have to restore the brand to its previous lustre while also squeezing out a profit and finding new efficiencies." Cole Haan generated $535M in revenues last fiscal year (FINANCIAL TIMES, 11/5).

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  • Bundesliga Club Werder Bremen Announces $17.8M In Losses For Fiscal Year '11-12

    Bundesliga club SV Werder Bremen lost €13.9M ($17.8M) during the '11-12 fiscal year the club revealed Monday, according to Matiszick & Dorow of the WESER KURIER. However, the club's management is "not too worried about this number as it has enough equity to balance the losses, and it also initiated a consolidation process." During the previous fiscal year, Werder Bremen generated a profit of €8.2M. Looking at the current loss and last year's profit, "the club has lost a total of €22.1M ($28.3M) during the '11-12 fiscal year." In addition, the club "did not break the €100M-revenue mark for the first time since '06-07." Werder Bremen generated revenue of €95.6M (122.4M) in '11-12. Club GM Klaus Allofs said, "We are not comfortable in our skin and would have liked to present a different result. But this is no reason to panic" (WESER KURIER, 11/5). 

    FORTUNE FOR FORTUNA: GOAL.com's Jan Schultz reported that Bundesliga club Fortuna Dusseldorf "generated a positive financial result for the first time in 16 years." Team CFO Paul Jäger "announced a profit of €800,000 ($1M) in front of more than 1,000 club members." Jäger said, "For the first time in a long time, the club again has positive assets of €63,988.04 ($81,900)" (GOAL.com, 11/6).

    IN HIGH DEMAND: Bundesliga club Hamburg SV "will increase the subscription volume of its successful fan bonds by an additional €5M ($6.4M)." The initial fan bonds to finance a new youth campus with a subscription volume of €12.5M ($16M) "have been sold out after only 17 days." Starting on Nov. 15, the club "will issue a new set of fan bonds" (SID, 11/5).

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