There’s not a ton to be gleaned from the Atlanta Braves’ first quarter release, especially since they did not report revenue from BravesVision. No matter. There were a few nuggets in the earnings release and call. There was also confirmation of some items that, if you were reading Battery Power, you should already expect. But first, a brief pause.
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or neutral and our posts should not be construed as such. The Braves have to put out an earning release, so it’s news about the team that we can report. Two, even if I had a take on a stock, you should seek out the necessary advice for your financial needs elsewhere. Seriously, I don’t care if you invest in gold coins or Urkelcoins or gold coins with Urkel’s face on them. It’s none of my business. Third, don’t take this post or anything else on Battery Power as advice either way to invest or not invest in any other financial instrument, even if Jaleel White has nothing else going on.
Top Line Numbers
Here’s the deal with a baseball team reporting revenue in the first quarter. That time period is January to March, and there isn’t much baseball going on. They don’t book the revenue until the game is played, even if they have received money for season tickets, single-game tickets, and suites. Baseball revenue is up 60% over last year because the Braves had 5 home games this yearin March versus zero last year. There was no Banana Ball in March this year compared to last year. So there’s your increase.
Their mixed-use development revenue (aka Battery Atlanta, Pennant Park, Turner Field hosted events, and the other real estate holdings) is up a Wall-Street-drool-inducing 41% year over year. That’s pretty much in line with last year. So even without baseball games and other prepaid ticket money coming in, there’s growth in the events and real estate holdings.
No BravesVision revenue specifics, but it’s likely very good
Yeah, this was why everybody tuned in, but the Braves did not release specifics on their wholly-owned television and streaming broadcaster BravesVision. It’s probably juicy though. Terry McGuirk praised the efforts on the entire development side of the organization. He described the creation of BravesVision as a “Herculean effort by the Braves to build an organization in three months that we expect to meet or exceed the economics generated under out prior RSN agreement.” It was “management excellence, in my opinion, and a big victory for the fans.” And it really is. Main Street, formerly Diamond Sports Group, the company that previously held the Braves television rights was a train wreck that bounced in and out of bankruptcy.
BravesVision is everywhere you want to be, with cable coverage throughout the Braves footprint and through Braves.TV. They described that the feedback that they received is that no one had trouble accessing the games. They are also “working to expand existing programming beyond just pre-games, in-game and post-game coverage so we have additional hours of content.” I believe that BravesVision is showing dead air when it’s not showing the game or a replay, so that’s great. They didn’t elaborate on what that content might be, but Gray Media and Raycom might be able to help. They did mention that Raycom was very helpful in standing up BravesVision in a short amount of time. They were “able to leverage existing relationships with Gray Media and Raycom to assist” getting BravesVision up and running. And “because of our partnership with Raycom, our upfront investment, particularly capital investment was relatively minimal.”
Derek Shiller doubled down with “I want to emphasize from an economics perspective, at this point in time, we can safely say that we’re going to meet or exceed the economics, which unto itself is a pretty large statement that we can make.” Translated: BravesVision equals more money for the Braves. It was always going to bring more money to the Braves. And the actions of their former RSN telegraphed this. In the last few years, several other teams were having their payments withheld, or were dragged through constant negotiation and bankruptcy. The Braves didn’t have to deal with any of this. No, their payments were always on time. It’s probably that the Braves were making enough profit to help keep Main Street afloat. The Braves were waiting at least a year to be turned loose on this effort. Now the old RSN is no more, and the Braves can attempt to get the broadcast revenue that the Yankees and Cubs receive.
Premium seating remains sold out
The high-dollar seats are sold out. They have sold 33,000 tickets per game of a maximum 41000-ish. They had seven sellouts already, which is very solid. This is some very back-of-the-envelope math, but the released numbers seem to suggest that the Braves make 4.5 to 5 million dollars per home game. That number is including tickets and concessions, but not parking or merchandise. Again, that’s an estimate, but it seems right. The Braves won’t release per ticket revenue, nor tell us what the suites are raking in.
The CBA, debt, buying more parking, and baseball stats
The Braves were asked about the impending lockdown. They referred all questions to Rob Manfred. The current deal with the Players Association ends in December. They said they were talking, but refused to elaborate.
The Braves paid down 30 million on their revolving debt. So that’s good. And I don’t think the Braves are looking to make another real estate purchase anytime soon. CFO Jill Robinson stated “I think we’ve done the big master planning projects that generate the highest returns. So going forward in the future, I would expect that [new spending] would come down a little bit.” They appear to have acquired the real estate that makes sense for them at this time. Anything more right now would be a reach. Right now, they are developing the space they have and also adding some nice restaurants.
Finally, Terry McGuirk loves him some run differential numbers. McGuirk did mention the much improved results of the on-field personnel. They’re in first place and tearing through the season. The Braves are number one in run differential. He said that he considers run differential as “one of the best power ranking metrics in all of baseball.” That might be an overstatement in a earnings call that didn’t contain any elsewhere. It might also be a friendly swipe at some media outlets that promote MLB power rankings like they mean something. Terry is clearly pumped from the winning, though, and so should everybody else.
