$87 million is the magic number if an NHL team is to make money in Winnipeg

Fourteen years have come and gone since the Winnipeg Jets played their last game at the Winnipeg Arena before packing up and moving to Phoenix.

After all those years, NHL hockey is like that long-lost love who left our lives without proper closure, whom we hope against all odds to be reunited with someday and thus leave the door open at least a crack.

Now there is talk — again — that the affair is over and the old flame is coming back home.

Many Winnipeggers would be ecstatic to see NHL hockey return to our city. Hockey is  a business, however, in which the objective is to run a profitable team.

According to Forbes magazine, the Phoenix Coyotes was the least valuable team in the NHL in the 2008-09 season, being worth a mere $138 million U.S., having posted an operating loss of $18.5 million on $66 million in revenues.

Last year, an analysis of the 2007-08 numbers estimated that a Winnipeg NHL team would have to pull in $86 million (U.S.) in revenues, including $35 million U.S. in gate receipts, to break even. To do this, it was estimated that the MTS Centre would have to be filled to 93 percent of capacity on average, with each patron paying on average a little over $68 Cdn. (taxes and fees not included) for the privilege of watching NHL hockey.

Fortunately, the break-even point has not risen very much over the past year — to about $87 million U.S. — and the Canadian dollar is a strong performer in world currency markets.

Operating income versus revenues, 2008-09 season

NHL team operating incomes and revenues, 2008-09 season. (Data source: Forbes Magazine)

Could an NHL team break the $87-million barrier in Winnipeg? Is there enough local corporate support and enough families of four willing to pay $300 for an evening out to make a Winnipeg NHL team profitable? We’ll see.

One thing’s practically guaranteed: With a civic election coming up in seven months and a provincial election coming up next year — or a federal election who-knows-when — it’s an ideal time to play to  politicians’ longing for the public’s love as the hero who brought the Jets home.

Let’s just hope they don’t get caught up so much in the wanting as to forget to get value for the citizen’s dime, which will almost certainly be offered up in any serious attempt to bring NHL hockey back to Winnipeg.

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About theviewfromseven
A lone wolf and a bit of a contrarian who sometimes has something to share.

2 Responses to $87 million is the magic number if an NHL team is to make money in Winnipeg

  1. Mike says:

    As a former Winnipeger who grew up with the Jets it broke my heart when the Peg lost its team and i quickly lost interest in the NHL. I really hope to see the a team return before the end of my lifetime, preferably much sooner.

  2. theviewfromseven says:

    Still a lot of work to do to get there, but it’s closer now than at any time in the past 14 years.

    As an aviation buff, be sure to check in on Sunday or Monday for an upcoming piece on the history of Transair, including some information and anecdotes that weren’t previously well-known outside of the airline.

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