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Tough economic times send revenue tumbling at Youngstown arena
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The Chevy Centre
Ups, downs at the Chevy
YOUNGSTOWN — The year didn’t end on a good note for the Chevrolet Centre as the city-owned facility lost $127,727 in October through December, typically its best financial quarter.
The center’s normally fragile financial condition has been severely affected by tough economic times, said Kyle Miasek, the city’s deputy finance director, and Eric Ryan, the center’s executive director.
The city on Tuesday released the financial statement of the center’s final three months of 2008.
The center received only $58,438 in sponsorship rights between October and December 2008 compared to $206,110 for the same time period in 2007, a $147,672 difference.
Among the biggest blows to the center’s sponsorship revenue was the loss in September 30, 2008, of the $175,000 it received annually — or $43,750 a quarter — from General Motors for the naming rights to the Chevrolet Centre, Miasek and Ryan said. The city-owned facility also saw a decrease in advertising revenue and other naming rights.
“We’re not immune to what’s happening all around the state and the nation,” Miasek said. “The center’s largest contract expiring at the worst possible time hurt the facility’s bottom line.”
The city is in negotiations with four companies for the center’s naming rights. A deal should be finalized no later than the end of March, Ryan said.
Also, income from the center’s luxury suites amounted to $80,383 in the last three months of 2008 compared to $132,650 for the last three months of 2007.
A major reason for the decline is the loss of the Youngstown SteelHounds of the Central Hockey League this season. The Mahoning Valley Phantoms junior hockey league team is using the center as its home ice this year.
Suiteholders were charged $20 for each SteelHounds ticket a year ago. The center is providing Phantoms tickets at no cost to its suiteholders, causing an additional financial impact.
Also, lower attendance at Phantoms games compared to the SteelHounds is affecting concession income, which is down by more than $30,000 in the last quarter of 2008 compared to 2007, Miasek said.
The city continues to work on getting a hockey team to the center for next season, Ryan said.
The city had wanted to get a team from the ECHL, a high-level minor hockey league formerly known as the East Coast Hockey League. But negotiations to get a team from that league failed.
A decision on hockey at the center is expected no later than March, Ryan said.
Among the possibilities are retaining the Phantoms for another season, looking for a team from a different league or not having a hockey team play at the center next season, Ryan said.
The center’s decision to eliminate a parking fee of $1.50 to $1.75 a ticket resulted in a loss of more than $75,000 in the last three months of 2008 compared to the same time period in 2007.
The center wanted the Trans-Siberian Orchestra to perform four shows at the facility in 2008’s last quarter, but TSO only did two concerts there. Both shows sold out and TSO has proved to be very popular at the center, Ryan said.
Two extra shows would have brought in about $50,000 to the center, he said.
Also, Disney on Ice’s six shows took place this month rather than December, when it traditionally performs at the center. The center makes about $7,000 to $8,000 per Disney on Ice show. The center made that money in 2009’s first quarter rather than the last quarter of 2008, hurting the latter’s bottom line, Ryan and Miasek said.
This is the first time the last quarter of a year lost money at the center, which opened in October 2005.
The center’s profit in the last quarter of 2005 was $545,471. It was $144,323 in 2006 and $151,203 in 2007.
The 2005 profit is deceptive because money for luxury suites, sponsorships and advertising was put into that one quarter rather than spread out evenly over four quarters, Ryan and Miasek said.
The center must find ways to regain lost sponsors and find new ones this year, Miasek said.
Ryan said he expects this quarter, January to March, to be good.
The quarter includes Saturday’s sold-out Harlem Globetrotters game, a Feb. 21 Kelly Pavlik middleweight boxing title fight that’s sold more than 6,000 tickets (as high as $500 each), and seven performances of Cirque du Soleil between March 4 and 8.
Ryan is optimistic that the center will be “very close to breaking even” in 2009.
Miasek is more guarded.
“We’re going to make some money [this quarter], but unless we close some of these deals, it’s going to be difficult to make a lot of money,” he said. “... We could lose a lot of money this year because of the economy.”
skolnick@vindy.com