Indians score hefty profits

December 15, 2008
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indiansIn good times and bad, the Indianapolis Indians continue to be a hit with local sports fans. The Indians scored a $1.23 million profit this year on $8.7 million in revenue, according to the publicly traded company’s most recent financial disclosure. That compares to a profit of $1.27 million on revenue of $8.22 million in 2007.

Revenue gains were offset by slight increases in expenses, with the most notable a $320,000 bump in advertising and promotion to $1.7 million. Grounds operation expenses were up slightly to $3.52 million and general and administrative expenses bumped up to $1.35 million.

As a result, Indians stockholders will get a dividend of $350 per share. That’s the same as last year, but up from $200 per share in 2006. The team is offering to buy back shares of stock currently for $21,328 per share. The stock, which is listed in the Pink Sheets, has traded for as high as $25,000 in the past year. Some stockholders believe the thinly traded stock is worth more than $30,000 per share. If you want to get in on the action, you might be a little hard pressed. There are only 774 shares outstanding. At $25,000 per share, that would value the team at $19.4 million.

There’s a reason why Indians stock is so valuable. It’s one of a dwindling number of sports properties that makes any money in Indianapolis. And it’s easily the most consistent.

Even in a year when the economy was less than stellar, the Indians saw increases in ticket revenue, concession sales and advertising income. Signboard advertising increased almost $100,000 from 2007, hitting $592,850. Promotional advertising revenue was up more than $130,000 to $858,827 and advertising in the team’s game-day souvenir program also was up. This shows that corporate Indiana understands the value of reaching this predictably solid audience.

This year the Indians drew 606,155, the team’s highest attendance mark since 2000. That put the team’s average attendance at 8,538 per game. If the economy continues to stagger, sports marketers think sports fans looking for relatively inexpensive entertainment options, could push the Indians attendance higher next season.
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  • This is great news for the average sports fan that can't afford to spend $100-$200 per game for a family outing to a sporting event. A spot on the lawn with the kids and a picnic basket is still the best value in town. I agree that the Indians will likely see another year of record crowds. People won't stop spending money, just spending it more wisely. And an Indians game is a bargain in my book!
  • I echo Boomer's sentiments. For a family of four on a budget there are few better ways to spend an evening in the summer than on the law at the Vic.

    As Harry Carray used to say You can't beat fun at the old ballpark.
  • Who does the Indians marketing? It's nice to see they convinced the Tribe to pony up some money for marketing - it definitely paid off this season.
  • It's my understanding that locally based Hirons & Co. handles advertising/marketing for the Indians.
  • As an HR Manager I convinced our president to purchase season tickets last year and it was a big hit among employees and clients. Even though the economy has somewhat impacted us, we have already renewed for 2009 since their prices are so low. We are proud to back the Indians.
  • Here's a web address that should appear hyperlinked in the blog: http://www.ibj.com, and here's www.ibj.com

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  1. Apologies for the wall of text. I promise I had this nicely formatted in paragraphs in Notepad before pasting here.

  2. I believe that is incorrect Sir, the people's tax-dollars are NOT paying for the companies investment. Without the tax-break the company would be paying an ADDITIONAL $11.1 million in taxes ON TOP of their $22.5 Million investment (Building + IT), for a total of $33.6M or a 50% tax rate. Also, the article does not specify what the total taxes were BEFORE the break. Usually such a corporate tax-break is a 'discount' not a 100% wavier of tax obligations. For sake of example lets say the original taxes added up to $30M over 10 years. $12.5M, New Building $10.0M, IT infrastructure $30.0M, Total Taxes (Example Number) == $52.5M ININ's Cost - $1.8M /10 years, Tax Break (Building) - $0.75M /10 years, Tax Break (IT Infrastructure) - $8.6M /2 years, Tax Breaks (against Hiring Commitment: 430 new jobs /2 years) == 11.5M Possible tax breaks. ININ TOTAL COST: $41M Even if you assume a 100% break, change the '30.0M' to '11.5M' and you can see the Company will be paying a minimum of $22.5, out-of-pocket for their capital-investment - NOT the tax-payers. Also note, much of this money is being spent locally in Indiana and it is creating 430 jobs in your city. I admit I'm a little unclear which tax-breaks are allocated to exactly which expenses. Clearly this is all oversimplified but I think we have both made our points! :) Sorry for the long post.

  3. Clearly, there is a lack of a basic understanding of economics. It is not up to the company to decide what to pay its workers. If companies were able to decide how much to pay their workers then why wouldn't they pay everyone minimum wage? Why choose to pay $10 or $14 when they could pay $7? The answer is that companies DO NOT decide how much to pay workers. It is the market that dictates what a worker is worth and how much they should get paid. If Lowe's chooses to pay a call center worker $7 an hour it will not be able to hire anyone for the job, because all those people will work for someone else paying the market rate of $10-$14 an hour. This forces Lowes to pay its workers that much. Not because it wants to pay them that much out of the goodness of their heart, but because it has to pay them that much in order to stay competitive and attract good workers.

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  5. It is sad to see these races not have a full attendance. The Indy Car races are so much more exciting than Nascar. It seems to me the commenters here are still a little upset with Tony George from a move he made 20 years ago. It was his decision to make, not yours. He lost his position over it. But I believe the problem in all pro sports is the escalating price of admission. In todays economy, people have to pay much more for food and gas. The average fan cannot attend many events anymore. It's gotten priced out of most peoples budgets.

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