http://mlb.mlb.com/news/article.jsp?ymd=20100828&content_id=14037064&vkey=news_fla&fext=.jsp&c_id=fla&partnerId=rss_fla

 

A Message To Our Fans:

 

While it is impossible to respond individually to all the misleading information and rumors contained in media reports related to your Marlins, the recent reports about the team's financial statements are so misleading that the record needs to be set straight.

 

Financial statements of the team were recently released and have been widely misunderstood and inappropriately analyzed. We would much rather have you debate the merits of our team on the field, root for wins, bemoan losses and analyze on-field strategies.

 

That said, attempting to draw conclusions of a baseball team's financial health is very hard to do by only taking a cursory look at a two-year snapshot. Worse, a small sample size gives one little perspective on circumstances surrounding other and prior years of operation. Therefore, examining such a small sample can be very misleading.

 

The messages that we delivered for years are all confirmed in these statements. The team had net income of roughly $33 million for the two years 2008-2009. This number does not include many cash expenses incurred by the team, so it is not the amount of cash held in a bank account at the end of this two-year period. The statements clearly show that of the $31 million of cash generated by the operation of the team, $24 million was spent on the new ballpark and the rest was used to reduce our team's debt.

 

Some of the team's debt is held by banks, some by Major League Baseball and some by the owner. Reducing the debt was and remains critical so that we can fulfill our contribution to the new ballpark, which is currently being built on time and on budget in Miami. To prepare and to be in position to pay a substantial portion of construction costs, the team had to execute a plan many years in advance. That plan was to stop incurring debt, actually reduce debt, and manage the team so that the banks, Miami-Dade County and the City of Miami would agree to do business with us.

 

The reduction of debt was a critical component of the team's operation, because losses from previous years had led to excessive debt balances. This large amount of debt would have made it impossible to contribute to the ballpark's construction and would have put baseball in Miami in jeopardy.

 

The promises made during the ballpark negotiations have all been met, and in fact, surpassed. There are currently 800 people working on the ballpark's construction, over 60 percent from Miami-Dade, with over 33 percent of those workers residing in the City of Miami. Both of these figures exceed the goals set by the county and city. We could go on, but the reality is that construction is proceeding very well as everyone can see by either going to our webcam online or in person.

 

In April 2012, there will be a first pitch thrown in an air-conditioned, retractable-roof state-of-the-art ballpark. Our partners are Miami-Dade County, the City of Miami, and most importantly, you, our fans. We will continue to do our best to ensure that the only thing you are worried about related to baseball is our yearly win total and our efforts to add to the two World Series championships that this young franchise and great city have to its credit.

 

Thank you for taking the time to read this.

 

Your Florida Marlins

 

 

 

Well said.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not been completely truthful in that the team cannot take higher a financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not completely truthful in that the team cannot take higher financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

 

please explain to me if the statement were not meant to be seen by the public, does that mean their are not truthful, if you have nothing to hide anyone can see them.

Meh, don't read much into this statement. The team has always twisted things around to make themselves sound better rather than admit some misdeeds, as they should. Loria likes to make a profit, and sometimes I believe, like many other have speculated for years, that Loria pockets some of the money made.

 

The financial records in no way shows that Loria actually pocketed the money, but it can somewhat be assumed based on Loria's character and history.

 

I don't claim to be an expert on this matter, this is simply an opinion of mine.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not completely truthful in that the team cannot take higher financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

 

please explain to me if the statement were not meant to be seen by the public, does that mean their are not truthful, if you have nothing to hide anyone can see them.

 

Because if you do release it, the numbers can be "manipulated" to tell whatever story the media wants...like the Marlins are making a great profit with no debt...like, uh, what happened?

 

Figuratively, sometimes it is better to keep your mouth shut then to open it and have someone try to jam your foot in there.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not completely truthful in that the team cannot take higher financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

 

please explain to me if the statement were not meant to be seen by the public, does that mean their are not truthful, if you have nothing to hide anyone can see them.

 

 

It means there is no PR / Marketing spin on them like the statement they released tonight... all I'm saying is read their financial statements for yourself try to interpret them... Finance is the language of business

 

The Marlins 2008 Net Income ($139.6M Total Revenue - $110.2M Total Expenses) was $29.4M or 21% ... to put things in perspective here are some fortune 100 company Net Income %s: Apple is 19% ; Walmart is 3%; Chervon is 6%... do you now see why it is outrageous that their Net Income % is 21%? a fair and still great return is 10% to 15% ...

 

 

 

AND YES, Loria is pocketing money thru the Management Services Fee paid to DoublePlay LLC which he also OWNS... indirectly he is taking money from one of his businesses and paying another one of his businesses... read the http://www.2thinkgood.com/ post for a detailed explanation

I think the main issue is that they're not supposed to use revenue sharing money to pay down debt or whatever, since it's specifically for payroll.

MiamiLifer247, your numbers are wrong. I'm just taking a quick break from a movie night so I'm not going to check them right now but the Marlins net income was $29M that year.

 

That said, their net income was $3.9M last year and the team overall is $61M in debt, negative equity.

 

Also, the fact that Double Play, which is the business which is in the contract with the County and City (as opposed to Florida Marlins LP) doesn't mean he's pocketing money at all. I believe it's Double Play that is paying for the stadium, so it'd make sense for money to go from Florida Marlins LP to Double Play.

I'm inclined to believe that the team is right on this one. It's easy for the media to overly simplify financial matters by selectively looking at a couple things, but financial matters are never simple and I just have a hard time believing that even with revenue sharing this franchise that has horrible attendance and little real following is somehow raking in the dough.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not completely truthful in that the team cannot take higher financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

 

please explain to me if the statement were not meant to be seen by the public, does that mean their are not truthful, if you have nothing to hide anyone can see them.

 

Private businesses have no obligation to release their financial statements to the general public, nor should they have such an obligation.

MiamiLifer247, your numbers are wrong. I'm just taking a quick break from a movie night so I'm not going to check them right now but the Marlins net income was $29M that year.

 

That said, their net income was $3.9M last year and the team overall is $61M in debt, negative equity.

 

Also, the fact that Double Play, which is the business which is in the contract with the County and City (as opposed to Florida Marlins LP) doesn't mean he's pocketing money at all. I believe it's Double Play that is paying for the stadium, so it'd make sense for money to go from Florida Marlins LP to Double Play.

 

 

The Net Income I quoted was 2008 since it was their last year of normal operations. 2009 will include extra expense due to building reserves for new stadium related activities, the 2009 income statement also includes $10.7M of expenses related to ballpark related expenses (2nd page of deadspin doc).

 

Also in 2009 they could have already been expecting that MLB was going to come down on them for not reinvesting the revenue sharing money, the smart thing for them to do would have been to build additional reserves to stash more money on the balance sheet and keep it from being reported as income.

 

Good catch on that I used 2008 data... it is better a gauge for true normal operating year.

i think a smart choice by the team and i am inclined to agree with them.

 

people are talking out of their asses and dont see the big picture that even with that 49 million we are still 106 million short to fund our end of the stadium on top of all of the other cash it takes to run a franchise.

 

 

Agreed, people are talking out of their a$ on this one and should leave the explaining of the statements to finance professionals... I happen to work in corporate finance and have read the financial statements... One thing is a clear fact, Samson has not completely truthful in that the team cannot take higher financial position in financing the new ballpark and remain profitable.

 

 

Jorge Costales (he is a CPA) has written some pretty good blog post on the leaked financial statements http://www.2thinkgood.com/ ... good read for the finance geeks like me.. the DoublePlay consulting company payments are very sketchy but are 100% legal

 

Keep in mind, numbers do not lie... people do, and that these financial statements were never meant to be seen by the public.

 

please explain to me if the statement were not meant to be seen by the public, does that mean their are not truthful, if you have nothing to hide anyone can see them.

 

Private businesses have no obligation to release their financial statements to the general public, nor should they have such an obligation.

 

I agree that private businesses have a right to remain private, but I do think that there is an exception if they are asking for money from public sources for such things as a new stadium. They don't have to open up all of their books, but they still need to be honest. If they were turning a massive profit and giving false information to Miami that indicated the exact opposite, I think there would be a reason for them to be upset.

 

With that said, as I've already indicated I don't think these supposed profits that the media has been claiming actually exist at all.

Well said is right. This thing has gotten way out of hand.

 

Mainly, the people who were so angry and frustrated when the financial documents came out were the people that were already complaining about how this franchise pockets a large portion of its money.

 

The statements didn't prove for a fact that the team doesn't spend as much money as they can. Even if they didn't, though, what else would you like them to do? A brand new stadium is about to be finished, we have one of the best position players locked up for the next four years, one of the best pitchers signed for the next three, and we are on the verge of extending yet another high-caliber player. Not to mention we have some of the best prospects in the game.

MiamiLifer247, your numbers are wrong. I'm just taking a quick break from a movie night so I'm not going to check them right now but the Marlins net income was $29M that year.

 

That said, their net income was $3.9M last year and the team overall is $61M in debt, negative equity.

 

Also, the fact that Double Play, which is the business which is in the contract with the County and City (as opposed to Florida Marlins LP) doesn't mean he's pocketing money at all. I believe it's Double Play that is paying for the stadium, so it'd make sense for money to go from Florida Marlins LP to Double Play.

 

 

The Net Income I quoted was 2008 since it was their last year of normal operations. 2009 will include extra expense due to building reserves for new stadium related activities, the 2009 income statement also includes $10.7M of expenses related to ballpark related expenses (2nd page of deadspin doc).

 

Also in 2009 they could have already been expecting that MLB was going to come down on them for not reinvesting the revenue sharing money, the smart thing for them to do would have been to build additional reserves to stash more money on the balance sheet and keep it from being reported as income.

 

Good catch on that I used 2008 data... it is better a gauge for true normal operating year.

You do have a point there but it was only 1 year. I'd imagine 2007 and 2006 had similar numbers but that doesn't speak of 2002-2005. The debt did come from somewhere.

 

Also, as I've said, you can't peg Double Play as "Loria pocketing money."

 

And they could do this or that, but you can't say they're "stashing money" just because it's possible, though their operation costs went up so I can't imagine any of that is true.

I think the main issue is that they're not supposed to use revenue sharing money to pay down debt or whatever, since it's specifically for payroll.

 

This is another issue entirely, though you're right. Though, for the record, it's not specifically for payroll, it's for "improving the play on the field" and the Marlins did have more money in player development than anyone else who's expenses were leaked.

 

Though, I'm wondering, with those rules is there any way the Marlins could make their money back? Last year the Marlins spent $93M in player contracts, how much would they have to spend over the revenue sharing income for them to be allowed to make a profit? Honest question.

 

 

EDIT: Ignore that, misread something. I'm still wondering on that question though.

The idea that Revenue sharing cannot be used to pay down debt is asinine. Money is fungible, if the team pays down debt at all, the argument could be made that revenue sharing money is used for it.

Good to see the Marlins address how stupid the media is.

The idea that Revenue sharing cannot be used to pay down debt is asinine. Money is fungible, if the team pays down debt at all, the argument could be made that revenue sharing money is used for it.

 

This is exactly what I'm saying.

Isnt there still some contention that a large portion, if not most(and if not all) of the debt is from the previous ownership of Montreal?

Yet another example of how far the clowns in the media will go to trash the Marlins is Rabin's article in the Herald on Saturday. After playing the "see how objective I am" game by devoting maybe 20% of his space to facts which totally undermine his basic premise, he's finally reduced to this gratuitous shot:

 

"Since then, the ballclub has jettisoned accomplished players, including Miguel Cabrera, Dontrelle Willis and, this year,Jorge Cantu and Cody Ross."

 

:lol :lol :lol

 

Even Willis was signed to a $30 mill contract before he threw a pitch for Detroit, he was a quality pitcher at the time, not to mention that getting rid of him turned out to be a great move. Cantu and Ross aren't even remotely close to being in the same class of players, but, hey, the Marlins haven't had to conduct a firesale for 5 years, so we'll just make believe that they did.

 

Sad. And, no, I won't provide hits to the Herald's junk by linking to it.

Isnt there still some contention that a large portion, if not most(and if not all) of the debt is from the previous ownership of Montreal?

 

No one knows, the financials don't say.

The idea that Revenue sharing cannot be used to pay down debt is asinine. Money is fungible, if the team pays down debt at all, the argument could be made that revenue sharing money is used for it.

 

Absolutely. Which is why MLB's statement of the purpose of revenue sharing is so general.

 

And the idea that sports reporters have even a modicum, no, make that a smidgen of understanding of financial matters or statements, or business in general is even more asinine. Not at all surprising considering that most of them are first steeped for years in the anti-business leftism of journalism schools: capitalism bad, big business worse, owners really bad, owners of any big business evil incarnate. Combine that with the Woodward-Bernstein model of "gotcha" journalism and they really are quite tiresome.

MiamiLifer247, your numbers are wrong. I'm just taking a quick break from a movie night so I'm not going to check them right now but the Marlins net income was $29M that year.

 

That said, their net income was $3.9M last year and the team overall is $61M in debt, negative equity.

 

Also, the fact that Double Play, which is the business which is in the contract with the County and City (as opposed to Florida Marlins LP) doesn't mean he's pocketing money at all. I believe it's Double Play that is paying for the stadium, so it'd make sense for money to go from Florida Marlins LP to Double Play.

 

 

The Net Income I quoted was 2008 since it was their last year of normal operations. 2009 will include extra expense due to building reserves for new stadium related activities, the 2009 income statement also includes $10.7M of expenses related to ballpark related expenses (2nd page of deadspin doc).

 

Also in 2009 they could have already been expecting that MLB was going to come down on them for not reinvesting the revenue sharing money, the smart thing for them to do would have been to build additional reserves to stash more money on the balance sheet and keep it from being reported as income.

 

Good catch on that I used 2008 data... it is better a gauge for true normal operating year.

You do have a point there but it was only 1 year. I'd imagine 2007 and 2006 had similar numbers but that doesn't speak of 2002-2005. [/b]The debt did come from somewhere.

 

Also, as I've said, you can't peg Double Play as "Loria pocketing money."

 

And they could do this or that, but you can't say they're "stashing money" just because it's possible, though their operation costs went up so I can't imagine any of that is true.

 

I would have to assume that when Loria and Co took over in 2002 they inherited whatever existing debt there was. H.(elwith) Wayne Huizenga sold because he couldn't turn a profit without his own ball park. John Henry the same. Which to me means they incurred debt. It didn't just disappear. And I can't see either of them paying it off before, during, or after the sale. Same reasoning I would use to think MLB accepted responsibility for the Expos debts when they took over that team from Loria.

Isnt there still some contention that a large portion, if not most(and if not all) of the debt is from the previous ownership of Montreal?

 

No one knows, the financials don't say.

 

See above post.