Want the Braves to Dump Melvin? Not Gonna Happen

The Financials

The Braves are part of a curious conglomerate of companies collectively owned by the Liberty Media Corporation, a publicly traded company (Nasdaq symbol LMCK).  Among the other sister companies are Viacom, Sprint Nextel, Time Warner Cable, and 56.7% of the SiriusXM satellite radio company.

Late last week, Liberty Media filed their annual report with the Securities and Exchange Commission.  It’s mostly the kind of stuff that accountants pore over and baseball fans doze off about, so I’ll spare the details.  But the Ajc.com did go over it, and there are some noteworthy highlights involving the Braves – who don’t normally get this much attention in that report.

• The team has borrowed $100 million – so far – to finance stadium construction.  They have also used some cash reserves for the project.
• LMCK obtained a line of credit for up to $250 million that can be used for that purpose ($100m used; $150m more available).
• This money is essentially “fronting” the stadium costs until Cobb County can issue the municipal bonds for their part of the stadium deal (up to $397 million – Liberty pegs the number at $368 million, to be available the second half of this year if the courts concur).  This advance funding was done to keep the project on schedule for a 2017 opening.
• While the AJC puts the total stadium cost at $622 million, the Liberty Annual Report mentions $622 million plus another $50 million “in other costs and equipment related to the new ballpark” that will be required.
• The report cites the future obligations via “long-term employment contracts” of “certain of their players”.  As of the end of 2014, that number was $398 million.  TomahawkTake.com data suggest this is now $402.7 million, not counting contract incentives.
• The additional “mixed use” development around the stadium is expected to cost $452 million – with $363 million of that paid for by “affiliated entities”.

BOTTOM LINE:  There was $10 million revenue decline for the team in 2014, down to $251 million from $261 million in 2014 (from AJC.com analysis).

WHY THE LOWER NUMBERS?

• Ticket revenue would have declined.  ESPN numbers show an average attendance per game in 2014 at 29,065 (18th ranked).  In 2013 it was 31,465 (13th in the league).
• The Liberty report has an interesting line in it:

"“increased player payroll due to season ending injuries at key positions which required additional players to be added to the roster. Additionally, other players were released from the roster and full recognition of guaranteed portions of their contracts were recognized during the current period.“"

• Translation of the financial-ese language?  Ervin Santana and Dan Uggla.

Much more as we continue… please hit NEXT….