Dale Zanine-US PRESSWIRE
While Jerry Richardson was telling the world about budget shortfalls, his team was thriving.
The life of a small market team is one of low profits, scraping by, and trying to make a business work-- at least that's the party line fans have been sold by the organization. The reality, however, is that while the Panthers were displaying their worst product on the field, the team were raking in money off it. While Jerry Richardson was quoting $200-million deficits, the reality was that the Panthers' owner and partners were pocketing close to $12-million. The report from Deadspin in its entirety can be found here, and it paints Carolina's owner as the NFL's Scrooge McDuck.
This report could not have come at a worse time if you're Jerry Richardson. Still involved in negotiations with the city of Charlotte, and state of North Carolina -- he's seeking a long-term funding agreement that would allow for upgrades in Bank of America stadium, with an ultimate goal on laying the groundwork for a new stadium plan down the road. Earlier this week Richardson was rebuffed by state governor Pat McCrory, and it remains to be seen whether this indictment of the team's finances will play a role.
Did anyone really believe Richardson was hurting financially? Absolutely not. However, the report speaks to a larger issue of poor-mouthing the organization as a negotiating tactic. The NFL owner's bulldog during CBA negotiations, he was happy to stand up against players, and had the pie charts to prove it. The reality, however, was that the team's financial were more than healthy -- they were thriving.
Public funding is an already sore topic for many North Carolinians. An Elon University poll reported 88% of residents oppose the idea of state government assisting in the public funding of stadium renovations in Charlotte. Pair disappointing performance on the field with questions about the ownership's motivations off it doesn't make for public good will towards the home team.
Ultimately these moves are designed to keep the Panthers in the Carolinas permanently. Richardson is a successful businessman, and he knows how to negotiate. That being said, Charlotte isn't Bedford Falls, and the Panthers' owner isn't Mr. Potter. The end goal is to reach an agreement with the city and state that benefits Richardson's estate, while locking the team into an agreement with the area -- one that would fall in step with a change in ownership from the Richardson family, mandated to occur following his death.
It's a moot point whether this is shocking news, but is important on how the city and state percieve the Panthers -- and that's the story to watch moving forward, at least for regional fans.
Update: 9:25 p.m.
The Carolina Panthers have released a formal statement in response to the Deadspin report, refuting the findings.
The Deadspin story presents an incomplete picture of the Carolina Panthers profitability. The figures offer an isolated snapshot of the team's financial situation during an unusual time as the NFL lockout loomed.
At the time, the team had strategically reduced its spending because of the uncertainty and as part of a long-term plan to secure the team's best talent once a collective bargaining agreement had been reached.
The team's actual operating cash flow, even before federal and state tax payments were made, was significantly less than the accounting income reported in the story. The most meaningful reflection of a company's profitability is cash flow, and the team's operating cash flow fluctuated between pre-tax figures of $26.7M in fiscal year 2011 and $39.8M in fiscal year 2012.
A detailed review of the financial statements demonstrates the difficulty of being competitive in the NFL, paying players to the cap, and trying to add the financing of a major stadium renovation.