Amortization isn't "cooking the books." It's proper accounting. Amortization is a "real loss" because the buyer had to invest his money to purchase the franchise in the first place. Using amortization gives businessmen the incentive to take the risk and purchase property, businesses, etc. I am sure Forbes included that in their estimates.

 

Yes, they did make $3 million last year after revenue sharing. A big part of revenue sharing is MLB welfare - basically the teams that lost money get extra cash from the teams that made money. That extra cash will only be there if MLB as a whole made money. If they lost money, no cash. What Loria wants to do is have the team break even or make a profit before getting any MLB welfare. Nothing wrong with not wanting to depend on a third party, is there?

FreshFish, according to Forbes, the Marlins made $3 million in 2004 after revenue sharing. They probably received about $20 million in revenue sharing, meaning their losses were about $17 million. So, yes, they're losing money and MLB welfare is saving them. Loria just doesn't want to rely on MLB welfare, with good reason.

 

 

15 million amortization "loss" as well as the operating expenses of Loria and Samson's salary count as cooked book losses.

 

Either way, care to share a link, I'd like to see Forbes' numbers.

Amortization isn't "cooking the books." It's proper accounting. I am sure Forbes included that in their estimates.

 

Yes, they did make $3 million last year after revenue sharing. A big part of revenue sharing is MLB welfare - basically the teams that lost money get extra cash from the teams that made money. That extra cash will only be there if MLB as a whole made money. If they lost money, no cash. What Loria wants to do is have the team break even or make a profit before getting any MLB welfare. Nothing wrong with not wanting to depend on a third party, is there?

 

the ultimate goal would be to make money w/o revenue sharing, but they shouldn't be misleading the public

FreshFish, according to Forbes, the Marlins made $3 million in 2004 after revenue sharing. They probably received about $20 million in revenue sharing, meaning their losses were about $17 million. So, yes, they're losing money and MLB welfare is saving them. Loria just doesn't want to rely on MLB welfare, with good reason.

 

 

15 million amortization "loss" as well as the operating expenses of Loria and Samson's salary count as cooked book losses.

 

Either way, care to share a link, I'd like to see Forbes' numbers.

 

It's not "cooking the books"! It's part of the Statement of Financial Accounting Standards that almost all businesses in the US abide by. Cooking the books is when you hide things or make them up or whatever. This is not cooking the books.

 

Moneyball posted the link to the Forbes figures and a number of people attacked him for it. Here it is: http://www.forbes.com/finance/lists/33/200...6&datatype=Misc

 

It actually does look like it didn't include the amortized costs. If they did, the Marlins would have posted a loss even with revenue sharing.

To answer the questions above, yes I think the franchise has lost money on an operating basis every year that Loria has owned it, and if you asked, I think it's probably closer to $20 million a year than breaking even.

 

Operating losses are money out of pocket. You have $100 in expenses and $80 in income, someone has to come up with the $20 shortfall, and guess what, it's you.

 

The whole premise here that somehow these tax losses turn into real money are laughable, at least as to their relative value. You have to be profitable to have a use for them. Paper losses go against the gross profitable income line, not the net. If an owner uses those losses to minimize profits while operating the franchise he's shooting himself in the foot (getting 20-30 cents on the dollar), because were he to sell, which is TSwift's theory, those carryforward losses would have already been used, and if he held onto them until the time of sale, they would instead offset a realized profit dollar for dollar.

 

And when is the tax liability the greatest? When you sell.

 

I was priviledged to see about a year ago a (proposed) offering memorandum for the first failed attempt to build a stadium (Miami Arena site) that was floating around the municipal bond underwriting community, and that was enough for me. The Fish were losing their shirts and Loria was putting in large amounts of $$$ on a regular basis to meet payroll and operating expenses. Real money. Clearly this is not a profitable franchise.

 

And this is a community that frowns on number manipulation. Putting out false or misleading numbers to underwriting community is the kiss of death going forward.

 

As for the Forbes article, my read of it says it is enormously flawed or at least "iffy". There's no explanation of how they derived their valuation number, if they based it on sales of other franchises and whether those franchises owned their own stadium (for example), they admit to having no inside view of the financial workings of the organization, but even Forbes concludes (after the 2003 championship season) "...Despite its championship the Marlins had $12 million in operating losses last season. "It's not okay when you write checks each year for $15 million--it's painful," Loria says. "I am not willing to continue to lose money forever." "

 

How prophetic.

 

As Swift said, we have to agree to disagree I guess. I think the Fish have been losing their shirts and Loria's love of the game is what has propped up this franchise and now he's decided to stop doing that.

 

You all are welcome to disagree.

2003, I agree that Loria is losing money by the boatload. He's receiving some income from MLB, however. So his real losses are not as deep as he says. Nevertheless, he wants the franchise to stand on its own two feet - the Marlins shouldn't rely on the profitable clubs to break even or reduce financial losses.

That Forbes site is fascinating.

 

And it poses a massive question to me:

 

How does the team experience a one year value change of 19% when by Loria and Samson's numbers, they lost close to 20% ($20 million) of their previous value ($136 million).

 

And, if the team has the worst lease in the majors, how the heck is it more profitable than 4 teams (Royals, A's, Twins, Devil-Rays) two of whom out-draw us, and three of whom (Royals, Twins, DRays) own the stadium they play in?

 

If an orphan team with a bad lease that is (according to its president) working with losses around 10% of its estimated value, yet it has an estimated value higher than teams that are both outdrawing it and have a home, something isn't right. Maybe I'm missing something, but it just doesn't add up.

What doesn't add up is the Forbes article.

That Forbes site is fascinating.

 

And it poses a massive question to me:

 

How does the team experience a one year value change of 19% when by Loria and Samson's numbers, they lost close to 20% ($20 million) of their previous value ($136 million).

 

And, if the team has the worst lease in the majors, how the heck is it more profitable than 4 teams (Royals, A's, Twins, Devil-Rays) two of whom out-draw us, and three of whom (Royals, Twins, DRays) own the stadium they play in?

 

If an orphan team with a bad lease that is (according to its president) working with losses around 10% of its estimated value, yet it has an estimated value higher than teams that are both outdrawing it and have a home, something isn't right. Maybe I'm missing something, but it just doesn't add up.

 

Is this AFTER we won a world series in 2003? If so, that could explain it.

That Forbes site is fascinating.

 

And it poses a massive question to me:

 

How does the team experience a one year value change of 19% when by Loria and Samson's numbers, they lost close to 20% ($20 million) of their previous value ($136 million).

 

And, if the team has the worst lease in the majors, how the heck is it more profitable than 4 teams (Royals, A's, Twins, Devil-Rays) two of whom out-draw us, and three of whom (Royals, Twins, DRays) own the stadium they play in?

 

If an orphan team with a bad lease that is (according to its president) working with losses around 10% of its estimated value, yet it has an estimated value higher than teams that are both outdrawing it and have a home, something isn't right. Maybe I'm missing something, but it just doesn't add up.

 

Is this AFTER we won a world series in 2003? If so, that could explain it.

 

By my understanding, this is after the 2004 season.