CHL minimum wage lawsuit reveals clubs' financials

[sureLoss]

Yesterday the judge in Calgary presiding over the minimum wage lawsuit unsealed WHL/OHL financial statements

http://www.tsn.ca/new-court-filings-...cials-1.667220

The Prince George Cougars, for example, lost money three years in a row between 2012 and 2014 but still sold for $6.4 million in 2015. Similarly, after losing $212,902 in 2014, the Hamilton Bulldogs sold for $10.3 million in 2015.

The Regina Pats sold for $6.8 million and the Sarnia Sting sold for $7.7 million, both in 2015. The Erie Otters in 2016 sold for $8.4 million (U.S.).

more tidbits in the article

also interesting is the NHL/CHL agreement's financial details were released:

According to terms of the contract between the NHL and CHL, the NHL paid the CHL a grant of $7.6 million in 2013-14, an amount that is set to escalate to $12.6 million by 2019-20.

The NHL also pays the CHL at least $750,000 per year to cover player school fees for current and former players not in the NHL or AHL, and at least $315,000 per year to educate players about the diagnosis and treatment of concussions.

Other payments cover officiating (at least $775,000 per year), minor hockey elite skill development (at least $500,000 per year) counsellors who advise players about substance abuse, gambling and sexual activity (at least $255,000 per year), and officiating (at least $775,000 per year).

CHL teams are also eligible for additional payments for sending players on to the NHL. A CHL team is paid $60,000 for a skater and $75,000 for a goaltender who is signed by an NHL team and retained after the start of the regular season. CHL teams are eligible for an additional $12,000 for skaters, and $15,000 for goalies if they are retained through Jan. 1 and there are more payments to CHL teams if players remain on NHL rosters past Feb. 1 and Mar. 1.

[jayswin]

CHL teams are also eligible for additional payments for sending players on to the NHL. A CHL team is paid $60,000 for a skater and $75,000 for a goaltender who is signed by an NHL team and retained after the start of the regular season. CHL teams are eligible for an additional $12,000 for skaters, and $15,000 for goalies if they are retained through Jan. 1 and there are more payments to CHL teams if players remain on NHL rosters past Feb. 1 and Mar. 1.

So the London Knights antics pay off in more than just championships and ticket sales. Neat.

[Oil Stain]

It'll be interesting to see what the top clubs are earning in a year.

I bet the higher earning clubs are raking in millions in profit.

I think the players in the CHL have gotten a raw deal for a long time. It'd be nice to see them share the benefits.

[Jay Random]

Tell you what: Let's have the CHL pay wages based on the financial capacity of the biggest markets.

Then we'll have the NHL pay wages based on the financial capacity of New York, Chicago, L.A., Montreal, and Toronto.

The Flames will wind up operations overnight, but hey, at least the Hitmen will still be playing in a 6-team WHL.

[sureLoss]

Some of the London Knights (perhaps widely precieved as the most profitable CHL team) financials:

Ryan Pyette ‏@RyanatLFPress
Well, just got a look at the @GoLondonKnights financial numbers. Waited a long time for this day. They're a money-making machine.

Ryan Pyette ‏@RyanatLFPress
The Knights, in 2015 (the only year in the past 5 they didn't play in the Memorial Cup, they saw $6.26M in revenue.

Ryan Pyette ‏@RyanatLFPress
Their 2015 net income was $1.87 million ($3.7M in expenses) and that was on the lower side of the past half-decade (lost in 2nd round).

Ryan Pyette ‏@RyanatLFPress
In the 2013 OHL championship year (Bo Horvat buzzer-beater), the Knights had a whopping $7.6M in revenue, but $4.6M in expenses.

[Rollin22x]

What I think is odd is that during an interview with one of the CHL reps, he said they submitted the financials anonymously. I don't remember the exact term but it was supposed to show team revenue without identifying the corresponding teams.

[MBates]

Originally Posted by Jay Random

Tell you what: Let's have the CHL pay wages based on the financial capacity of the biggest markets.

Then we'll have the NHL pay wages based on the financial capacity of New York, Chicago, L.A., Montreal, and Toronto.

The Flames will wind up operations overnight, but hey, at least the Hitmen will still be playing in a 6-team WHL.

Yeah I am really interested about this. If the suit gets certification I expect a relatively quick settlement for a fraction of what the suit claims. I can see both sides here. Players have been taken advantage of in some ways no doubt. But if the league had to run as ordinary employer / employee situations with all of the employment standards code being applicable it is difficult to see how the league would have existed in its current form to get many players into the NHL.

Very interesting to see my former principal / boss and avid sports fan (though mostly baseball and golf) Justice Hall presiding. Great practical and fair minded judge. Can be completely trusted to hear all arguments and then follow the law and the evidence.

[Erick Estrada]

The Hitmen should be up there for profitability.

[GGG]

Originally Posted by Jay Random

Tell you what: Let's have the CHL pay wages based on the financial capacity of the biggest markets.

Then we'll have the NHL pay wages based on the financial capacity of New York, Chicago, L.A., Montreal, and Toronto.

The Flames will wind up operations overnight, but hey, at least the Hitmen will still be playing in a 6-team WHL.

Thr London knights would have to revenue share. If on average the league can afford it then it's poor distribution of revenue and the teams need to decide if the size of league they need to be popular is worth propping up other teams.

Season is 24 weeks with 20 players so 500 person weeks of work @ say 40 hrs per week is 20,000 man hours with a $12 wage would be 250,000 per team.

If the Prince George Cougars are worth 5 million they should be making 500k per year in profit or more given the risk and variability in the product.

Therefore they can either afford minimum wage at the bottom end of the teams or they are grossly overvalued.

Also if there education scholarships didn't expire theyd be worth about 5-10k per year or almost as much as minimum wage.

[sureLoss]

Originally Posted by Rollin22x

What I think is odd is that during an interview with one of the CHL reps, he said they submitted the financials anonymously. I don't remember the exact term but it was supposed to show team revenue without identifying the corresponding teams.

They tried to submit it as anonymous, but the judge ruled that they couldn't and all the data would be public.

[FlamesAddiction]

Do CHL teams get paid by the NHL to develop players after they are drafted by an NHL team?

I always assumed that was the case, but reading that sounds like they are only paid if the player jumps from the CHL to the NHL.

[PlayfulGenius]

Originally Posted by sureLoss

Some of the London Knights (perhaps widely precieved as the most profitable CHL team) financials:

Ryan Pyette ‏@RyanatLFPress
Well, just got a look at the @GoLondonKnights financial numbers. Waited a long time for this day. They're a money-making machine.

Ryan Pyette ‏@RyanatLFPress
The Knights, in 2015 (the only year in the past 5 they didn't play in the Memorial Cup, they saw $6.26M in revenue.

Ryan Pyette ‏@RyanatLFPress
Their 2015 net income was $1.87 million ($3.7M in expenses) and that was on the lower side of the past half-decade (lost in 2nd round).

Ryan Pyette ‏@RyanatLFPress
In the 2013 OHL championship year (Bo Horvat buzzer-beater), the Knights had a whopping $7.6M in revenue, but $4.6M in expenses.

Ryan Pyette is a fool if he thinks that business is a 'money making machine' ...ugh, and that's by far the best in the league????

I was completely pro-paying-players in the CHL, but now I'm not so sure.

[MBates]

Originally Posted by PlayfulGenius

Ryan Pyette is a fool if he thinks that business is a 'money making machine' ...ugh, and that's by far the best in the league????

I was completely pro-paying-players in the CHL, but now I'm not so sure.

I don't mind admitting I don't fully understand. If you have revenues of $7.6 million as a junior hockey club (being $3 million more than your expenses) is that not machine-like making of the money?

I appreciate that might not be indicative of long term financial stability but it is a huge pile of money for "amateur" hockey no?

[Resolute 14]

Originally Posted by Rollin22x

What I think is odd is that during an interview with one of the CHL reps, he said they submitted the financials anonymously. I don't remember the exact term but it was supposed to show team revenue without identifying the corresponding teams.

Even when we saw the first numbers and it was still anonymous, teams like the Knights and Hitmen were pretty obvious given they are by far the largest revenue generating teams in their leagues.

[Resolute 14]

Originally Posted by MBates

I don't mind admitting I don't fully understand. If you have revenues of $7.6 million as a junior hockey club (being $3 million more than your expenses) is that not machine-like making of the money?

I appreciate that might not be indicative of long term financial stability but it is a huge pile of money for "amateur" hockey no?

It's a matter of scale. When you consider the high end profit there is equivalent to Deryk Engelland's annual salary, "money making machine" doesn't seem like an accurate statement. When you compare against the Lethbridge Hurricanes, who were losing $200k per year on average between 2009 and 2014, and the perspective changes.

[zukes]

The London Knights totals cannot be accounting for everything. That must be straight hockey related revenue. 9100 every game (slightly high, but close), $20 per ticket (likely slightly low), 34 home games = $6,188,000.00 alone in ticket sales, not counting pre and post season.

So the rest of their "revenue" is less than $100,000.00 some years? I call BS.

I'm a Knights fan and go to many games a year. I can tell you that Friday games in particular are an event, and people spend a lot of money at the games as well. The amount spent in beer alone has to be insane. I'm sure the Knights get a cut of that.

For those not familiar with London, the old arena used to be at the very south end of the city by the 401 and was an old dump that held 2,000 people and never sold out. The new arena was built downtown in a downtrodden area. Now that area has high rises, bar, restaurants ranging from pubs to high end, boutique shops etc. I'm sure the Knights get very favourable breaks from the city for the revitalization of downtown. The Knights sell out almost every game now and have since the arena opened.

[FlamesFanStrandedInEDM]

I would give them the choice between receiving minimum wage or their post-secondary scholarship. A couple years ago at Teacher's Convention, I met one of the people with the CHL scholarship office and the percentage of players who redeem their free-education is ridiculously low.

[GGG]

Originally Posted by FlamesFanStrandedInEDM

I would give them the choice between receiving minimum wage or their post-secondary scholarship. A couple years ago at Teacher's Convention, I met one of the people with the CHL scholarship office and the percentage of players who redeem their free-education is ridiculously low.

It expires so if you go play hockey in Europe or echl level trying to extend the dream you lose it. That said fixing the scholarships would likely be better for the players than giving them 10k in cash.

[Kjesse]

Originally Posted by zukes

The London Knights totals cannot be accounting for everything. That must be straight hockey related revenue. 9100 every game (slightly high, but close), $20 per ticket (likely slightly low), 34 home games = $6,188,000.00 alone in ticket sales, not counting pre and post season.

So the rest of their "revenue" is less than $100,000.00 some years? I call BS.

...... The new arena was built downtown in a downtrodden area. Now that area has high rises, bar, restaurants ranging from pubs to high end, boutique shops etc. I'm sure the Knights get very favourable breaks from the city for the revitalization of downtown. The Knights sell out almost every game now and have since the arena opened.

I think this is exactly right, and there are a separate group of corporate entities that are getting those other profits but which are not being reported as hockey revenue for accounting purposes.

[GioforPM]

Originally Posted by Erick Estrada

The Hitmen should be up there for profitability.

They seem to bring in a fair amount of revenue, but no profit for the last couple years.