FanPost

Team Profits/Losses for 2009-10: My best guess

I've been using Forbes' data on NBA franchises from 2007-08 (http://www.forbes.com/lists/2008/32/nba08_NBA-Team-Valuations_Rank.html)  to try and make some predictions, not just on what teams made or lost money this past season, but also looking ahead to 2009-10. Here are some of my 'conclusions':

Important Notes/Assumptions:
1) I was able to make a basic comparison of home ticket income from 2007-08 to 2008-09 using average attendance and average ticket price data. However, there's that all-elusive 'other income' figure. For 2008-09, my assumption is that 'other income' dropped 1%.

2) My assumption is that overall income for each team drops 4% in 2009-10.

3) This is a snapshot using current player salaries and team salary figures for 2009-10. It does not include any free agent signings or trades that have not yet happened - although it does include players who have agreed to deals such as Andre Miller, Ersan Ilyasova, etc. I also made the assumption that all restricted free agents sign for their qualifying offer amounts. But there are no numbers entered for current unrestricted free agents, including Lamar Odom, Allen Iverson, David Lee, etc. So if you think that Atlanta will re-sign Marvin Williams for $8 million, then you can lower their financial projection by $0.64 million (the difference between $8 million and his $7.36 million qualifying offer). If you think that OKC will sign Lamar Odom for $9 million, then you can lower their financial projection by $9 million. If you think that the Lakers will re-sign Odom for $9 million, then you can lower their financial projection by $18 million (including luxury tax). And so on.....

4) My assumption is that non-player-salary expenses for each team stays the same in 2008-09 and in 2009-10 as it was in 2007-08. I thought about dropping these numbers some but ended up keeping them the same.

5) I could be totally off here, but I think I'm being conservative with these numbers, especially with the losses. The Minnesota Star-Tribune reported a couple of days ago that the Timberwolves lost $19 million last year - my 'guess' has them at losing $12 million. So the losses might even be larger than these 'guesses'.

Anyway here's what I've come up with:

For 2008-09, my guess at operating income for the teams is: (negative amounts are listed between < >)
Chicago - $46.49 million
LA Lakers - $42.32
Detroit - $34.04
Houston - $28.28
Phoenix - $27.03
Boston - $18.01
San Antonio - $17.64
New York - $17.28
Golden State - $15.13
Toronto - $13.85
Washington - $9.59
LA Clippers - $9.10
Miami - $9.07
Cleveland - $8.13
Philadelphia - $6.89
Utah - $3.10
New Orleans - $1.48
Denver - <$0.48>
Milwaukee - <$0.86>
New Jersey - <$2.95>
Sacramento - <$3.30>
Indiana - <$6.54>
Atlanta - <$6.96>
Portland - <$7.42>
Oklahoma City - <$7.66>
Orlando - <$9.50>
Minnesota - <$12.03>
Charlotte - <$12.79>
Memphis - <$14.92>
Dallas - <$25.25>


For 2009-10, my guess at operating income for the teams is: (negative amounts are listed between < >)
Detroit - $42.54 million
New York - $38.52
Chicago - $35.70
LA Lakers - $20.90
Houston - $18.21
Phoenix - $13.68
Golden State - $13.47
Portland - $13.45
Toronto - $13.20
LA Clippers - $10.92
Philadelphia - $9.83
Boston - $9.46
Sacramento - $8.45
Oklahoma City - $7.12
Cleveland - $5.79
Miami - $0.63
Indiana - <$2.63>
Milwaukee - <$3.77>
Minnesota - <$5.06>
New Jersey - <$5.47>
Atlanta - <$6.53>
Washington - <$7.45>
San Antonio - <$9.44>
Memphis - <$11.57>
Dallas - <$17.71>
Charlotte - <$18.68>
New Orleans - <$21.23>
Denver - <$23.87>
Utah - <$29.63>
Orlando - <$33.09>

 

Why is this important?

When considering future trade ideas, I think you need to consider not just 'is a team over the cap' or even 'is a team going to pay luxury tax' but also 'how will this trade affect the anticipated profit/loss margin'.  For example, the New Orleans proposed deal of Tyson Chandler for a draft pick.  From a purely basketball perspective, it doesn't make sense.  From a financial perspective, it makes a lot of sense.

Anyway, these are just my best guesses.....

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