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Signing bonuses boosted the team’s player costs.
Photo by: GETTY IMAGES
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The Green Bay Packers last week reported $25.3 million of net income for the fiscal year ended March 31, but when it comes time for the club to make its earnings report at this time next year, that figure will likely double.
According to team officials, because of the timing of when the team signed free agent contracts, four major signing bonuses from both the 2013 and 2014 seasons fell into the fiscal year the team just reported. That money sent player costs surging $35 million, to $171 million, even with a flat salary cap for the 2013 season.
Packers President Mark Murphy said that even with the salary cap for the upcoming season rising $10 million per club, the team’s player costs, which include bonuses, travel and benefits, would decline.
The NFL’s new national TV contracts kick in this year, as well. A source with access to the league’s internal figures said that each club in 2014 would enjoy a $27 million bump in national TV money. With the player costs expected to decline for the Packers, that extra TV money would then fall entirely to the bottom line — meaning Packers net income should be more than of $50 million.
“Next year, Packers profits should go higher because they paid some major signing bonuses this year, and now there are the new TV contracts,” said sports consultant Marc Ganis, who’s worked with the NFL. “It is not an Internet business that is generating 30 or 40 percent returns, but it is strong and steady.”
Assuming the team does earn $50 million in the new fiscal year, that would mean in the first four years of the current collective-bargaining agreement, the team will have earned $161 million.
The Packers are the only team in the NFL that releases its earnings publicly, so the results are often used as a lens into the economics of the league.
The team’s national revenue in the most recent year was $187.7 million, a sum that’s equal for each NFL club. Gains in the NFL Network from distribution deals with Time Warner Cable and Cablevision fueled the 4 percent increase in the category, Murphy said.
That national figure will rise substantially next year with the new broadcast deals, so while national revenue now represents 58 percent of the Packers’ total revenue, that percentage looks to easily top 60 percent in the coming year.
That is a trend expected across all the league’s teams.
