In the team’s latest financial report, a preview of which was released to the media this week, the Packers’ operating profit for the 2010 fiscal year (ending March 31, 2010), was $9.8 million, down from $20.1 million the year prior. The primary reason for the decline, despite a $10.1 million increase in overall revenue, was a $22.1 million jump in player costs, which increased 15.9 percent from $138.7 million to $160.8 million. It marked the third consecutive year that operating profits declined, from $34.2 million (2007) to $21.4 million (2008) to $20.1 million (2009) to $9.8 million (2010).
That’s the trend the Packers have pointed to as unsustainable – declining operating profits, which reduce club incentives to make investments necessary to grow the game – and is the key issue in the league’s ongoing negotiations for a new collective bargaining agreement with the players’ union.
Over the four-year period since 2006, the Packers have generated $132 million in incremental revenue, and $123 million of that, or 94 percent, has gone to player salaries. Comparing the most recent fiscal year to 2006, the Packers’ revenues are up $50 million, from $208 million to $258 million, while player costs have gone up $58 million, from $103 million to $161 million.
Seen another way, the Packers’ revenues have grown 5.5 percent annually over the past four years while player costs have increased 11.8 percent annually, or more than double the rate.
“We’re working hard to contain the expenses that are in our control,” said treasurer Larry Weyers, who noted the rest of the franchise’s operating expenses, outside of player salaries, actually decreased this past year, from $89.1 million to $87.3 million. “Those have remained flat or gone down in recent years.”
