Thursday, April 23, 2009

Kansas City Royals are winners!

The Royals were big time winners in 2008.

You read that right. The value of the Kansas City Royals franchise rose 4 percent in 2008, eighth highest in Major League Baseball, behind only the Yankees, Mets, Rays, Cubs, Twins, Marlins and Brewers, in that order. The Royals were squarely in the middle of the 17 teams whose value increased during 2008, joined there by the Dodgers, Padres and Phillies at 4 percent.

In fact, the Royals have been winners across the new century. The only year the Royals lost value was 2003 when the worth of the franchise fell $11 million. But taken as a whole, the Royals have proven a fine investment, increasing from a value of $96 million in 2000 to $314 million in 2008. That's 300 percent and change.

These are the findings released today by Forbes Magazine.

Here’s one finding you’ll love. The Royals squeezed out nearly 10 percent more victories per dollar spent on players than the league average in 2008. Might not have seemed like it to you as you watched the loses from the stands, but you were witnessing a terrific season.

So, a 327 percent return on investment across eight years ain't bad. No reason to feel sorry for the Glass family. In fact, as you watched those loses mount, you should have been cheering ... the bottomline.

In fact, the Royals had a much better season than the Yankees in 2008. The Royals operating income was $9 million, according to Forbes. The Yankess lost $3.7 million in operating income in 2008 and, like every thing else in Detroit, the Tigers lost a whopping $26.3 million in 2008. Operating income is what the team earned before interest, taxes, depreciation and amortization are calculated. The Royals earned $143 million in 2008; the Yankees earned $375 million, which, in terms of the bottomline, means the Royals beat the Yankees last year despite ranking 28th in take. Only the Marlins took in less money.

Don't cry for the Yankees, however. In 2008 the Yanks as a franchise increased 15 percent in value, most in the major leagues, and the franchise you love to hate is currently worth -- according to Forbes -- a cool $1.5 billion.

I know you were miserable watching the Royals last year. But think positively. You were actually enjoying the play of a winning franchise. You just have to adopt the other guy's perspective.

BTW: Friday -- The Star finally got to this story but their take is quite a bit different, emphasizing the negative aspects of the report the way your poor cousin does when he is thinking he will ask you for a loan after Thanksgiving dinner.


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