Moag and Company Sports Notes (26 April 2019)

Date: Apr 2019

Trivia

Who was the first NHL player to score more than 70 goals in a season?  

Last Week’s Answer: Tiger Woods first victory on the PGA Tour was on October 6, 1996 in the Las Vegas Invitational. His victory was a 27 under par playoff victory over Davis Love III.

Football:

An estimated 200,000 people made up the "throng of fans that engulfed Lower Broadway" in Nashville for the first round of the NFL Draft, according to the Nashville Business Journal. The crowd was "more than double the estimated daily average for the CMA Music Festival" -- Nashville's biggest multiday annual event. The "densely packed crowd reached four blocks up Nashville's honky-tonk row," with stragglers "probably all the way back to Bridgestone Arena." Many fans who were "able to make it into the honky-tonks watched from rooftops and through windows". Nashville deserves "kudos," as the scenes from the Draft "looked amazing on television." Lower Broadway was "perfect for this epitome of football festivals". Nashville "looked great as a backdrop" to the Draft. Even in the rain, fans "wedged themselves into the street, giving the vibe of Times Square on New Year's Eve" in "one dizzying aerial shot after another". It was noted that the streets of Nashville were "jammed and it didn't matter that it was pouring rain”.

Baseball:

Rogers Communications President & CEO Joe Natale "remains fiercely committed" in the company's ownership of the Toronto Blue Jays "even after costly trades of two players led to an earnings miss," according to Bloomberg News. Natale said, “We are very much focused on the broad sports business, and we’re focused on investing in the capabilities of our sports properties as a whole." Rogers reported adjusted earnings per share in Q1 that were "below the lowest analyst estimate, partly due to a hit in media revenue following the trades" of C Russell Martin and DH Kendrys Morales. The Blue Jays had to "pick up portions of both players’ contracts as part of the deals." Rogers CFO Tony Staffieri last year said that the company was "considering selling assets such as the Blue Jays and a stake in media company Cogeco Inc. to off-load capital for other investments." However, Natale said last week that he has "no plans to sell the team".

Basketball:

The NBA is now "allowing clubs to sell international sponsorship rights" after team owners "approved a three-year test of the International Team Marketing Program" at their board of governors meeting earlier this month, according to the Sports Business Journal. The program will allow each team to "sell global marketing rights to two current or new sponsors beginning next season." Previously, the league "controlled all international sponsorship inventory." Domestically, teams are "limited to a 75-mile marketing territory, a policy that remains in place." The international program "allows teams to include global advertising and marketing rights outside the U.S. and Canada; activation at retail locations globally outside the U.S. and Canada; and rights to post non-game team content on the sponsors’ own digital and social media sites such as their company Facebook or Twitter pages." While teams can "sell the new global rights to any two sponsors, many team naming-rights and jersey patch sponsors are global brands and would be likely targets in the new program." NBA President of Team Marketing & Business Operations and Chief Innovation Officer Amy Brooks said that while the new plan "offers teams more revenue, that’s not the primary goal." Instead, she said that it is to "take advantage of the global reach of team partners and to create more targeted non-game content." Under the new plans, sponsors "can use non-game content such as behind-the-scenes features but game highlights are prohibited".

Hockey:

The financial returns from the Carolina Hurricanes' first playoff appearance in 10 years will take some time to calculate, but team President & GM Don Waddell said that they "might not be all that consequential anyway," according to the Raleigh News & Observer. This is because the "majority of first-round playoff revenue goes to the NHL and not individual franchises." Hurricanes execs are "less interested in what the team's recent success means to the current bottom line compared to what it might mean years from now." Waddell said, "The driver is for us to create the excitement of building your season ticket sale base for next year." Five years ago, Waddell said that the team's' season-ticket holder base "amounted to 5,200." This season, it was approximately 7,400. Last year, Waddell said that the team "generated about $400,000 in 'new' ticket revenue for next season." Now, he said that the Hurricanes have "already generated" $2M in new ticket revenue. Under the leadership of Owner Tom Dundon, the Hurricanes have "tried to build a culture of showmanship and entertainment." Dundon said what drives the success of any franchise "can't just be winning." Dundon: "If winning is your only plan, then you're only going to be halfway successful." He added that the team has "much work to do in the areas of corporate sponsorships, ticket sales and suite sales." He said, "Our revenues are below other NHL teams. And given that, what you'd like to do is at least be average, maybe slightly above".

Other:

The Smith family's proposal to take SMI private is worth more than $734M, with SMI President & CEO Marcus Smith citing "financial headwinds facing the racing industry as a reason for the move," according to the Charlotte Observer. The Smith family and its Sonic Financial Corp. "already own approximately 29 million shares and control over 70% of the voting power" of SMI. Smith said that the $18.00 per share that his family will pay for the company’s outstanding shares "represents 'a significant premium' of 31% to Monday’s closing price of $13.94." The company’s shares closed Wednesday at $18.55. Smith: "NASCAR has indicated the sport would benefit from structural change. We believe [SMI] would be more able to compete in this challenging and changing environment as a private company". SMI's BOD has "created a special committee to evaluate" the proposal, but "no deadline for the committee’s recommendations was disclosed." The move "acknowledges that NASCAR and other auto-racing series are shrinking".

 
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