GREEN BAY – The Packers didn't repeat their record profits from 2017, but their latest report shows a strong financial picture at 1265 Lombardi Ave.
On Monday, the organization reported $34.1 million in profit from operations and $38.6 million in net income for the fiscal year that ended March 31.
While those figures are down around 47 percent from the prior year, the reasons don't have President/CEO Mark Murphy concerned for the future.
"I don't think it's a trend," Murphy said. "Some things are cyclical. It was a strong year for us financially."
Expenses increased nearly $45 million, however, for a number of reasons. The personnel changes in football operations, including several on the coaching staff, came at an increased cost.
Team travel expenses also rose considerably, and depreciation of the organization's capital investments went up as well.
In addition, the salary cap rose $11.7 million, the fifth straight year it's grown by more than $10 million. Several significant player signings as the 2017 season ended and the offseason began led to a large bump in overall player costs.
The large drop in net income was due in part to a spike in that figure a year ago, when the Packers' $27 million share of franchise relocation fees (involving the Rams, Chargers and Raiders) came on the books all at once. It was a one-time accounting of money that is being paid out over a 10-year span.
Local revenue was also impacted as the Packers went 7-9 and missed the playoffs in 2017 for the first time in nine years, playing without two-time MVP quarterback Aaron Rodgers for 10 games.
"Overall, the performance of the team does have an effect on the financial performance," Murphy said.
Local revenue – which includes Pro Shop sales, Hall of Fame visits and stadium tours, among other things – stayed relatively flat, rising just $1.6 million. National revenue, driven largely by broadcast contracts with built-in increases, rose by $12 million.
In recent years, the Packers have ranked solidly in the top half of the league in overall revenue, usually around the bottom of the first or top of the second quartile. The revenue ranking for this past year will be known in the fall.
A contract extension for Rodgers also remains in the works and has not been finalized. But the team has been preparing for it, and it won't impact other financial considerations.
"We're in really good hands. Russ Ball is as good as anyone in the league in terms of managing the cap," Murphy said. "I have all the confidence in the world we'll be able to reach an agreement and work it into our cap for the future."
The Packers also are continuing to invest in both their stadium and the community.
The franchise's overall charitable impact topped $8 million for the past year, and a number of community-oriented activities are planned as part of the franchise's 100 Seasons celebration. A traveling Lambeau Field Live exhibit is making its way around the state of Wisconsin, and fan activities and concerts will be part of the Packers Experience during training camp.
Lambeau Field is in the process of getting a new playing surface, and new stadium lights have been installed. Concourse renovations are also under consideration for the near future.
Titletown, the development west of Lambeau Field, also opened to positive reviews, as the public park and plaza, featuring an ice skating area and tubing hill, were well-received. The development's three anchors – Hinterland, Lodge Kohler and Bellin Health Titletown Sports Medicine and Orthopedics – are up and running, while a joint venture with Microsoft known as TitletownTech is up next.
Financially, Titletown has required a significant up-front investment, with greater return expected down the road. The motivation isn't entirely driven by the franchise's annual bottom line, either.
"We've been very pleased with the start of Titletown," Murphy said. "It's a long-term investment for us. The goal is this will benefit the community. We're providing the community with an asset, and making sure the local economy stays strong is key.
"The impact of something like Titletown here is greater than it would be in any other professional sports market."
After going over the financial report, Murphy addressed a few other topics with reporters on Monday. Here are a few of his key comments:
Rodgers' contract: Rodgers mentioned over the weekend at a golf tournament the possibility of a non-traditional contract, but Murphy declined to get into any specifics.
"We want to get a deal done with Aaron. I think we both want the same thing," Murphy said. "Those things have a way of working themselves out. I'm confident we'll get something done.
"He wants to be here, we want him to be here, and when both sides have common interests, those tend to get deals done."
New structure, new season: The Packers' run of eight consecutive playoff appearances ended in 2017, and 2018 begins with more change in Green Bay than usual, with Brian Gutekunst taking over as general manager for Ted Thompson, and Mike McCarthy making a number of changes to his coaching staff.
"We don't want to get used to it," Murphy said of missing the postseason. "We want to get back to the playoffs, but the reality is the league is extremely competitive, and it's hard to win on a consistent basis. What we were able to accomplish with the playoff run that we had was impressive.
"I have all the confidence in the world in Mike. He made difficult changes that had to be made, and obviously with transitioning to his role and Brian now, I'm very optimistic. I think we've set ourselves up for a pretty good run over the next few years to get back to where we want to be, and that's competing for Super Bowls."