The New Orleans Hornets' Sad Financial Documents

We've obtained audited financial data for David Stern's new prize, the New Orleans Hornets. The statements cover 2008 and 2009, and among other things they paint a picture of a team already in hock to the NBA.

Two things jump out, at least to this layman's eyes: the team's operating income, which in 2008 was a $6.4 million loss and in 2009 was a $5.9 million gain (slide 11), though that latter figures includes $3.4 million in revenue assistance from the NBA (slide 28); and the team's net cash in operating activities, which represents the "measurement of money [owner George Shinn] is being asked to take out of his pocket to keep operations going," according to sports economist Andrew Zimbalist. In 2008, that amount was $7.4 million; in 2009, $1.4 million (slide 13). Zimbalist points out that "things got much more problematic for the franchise" the following year.

Also of note: As of June 30, 2009, the partners' deficit totaled $83 million (slide 14). The team's share of national broadcast rights payments was $26 million in 2008 and $28 million in 2009 (slide 28). And in 2008, the Hornets were told they had received revenue-sharing money in error for the 2005-06 season — $2.8 million, by the looks of it (slide 27). The money was paid back in 2009.

We'll have more on this later.

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