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The New York Knicks are the worst team, the worst run of the National Basketball Association. However, his parent company is doing well.
A day after the Knicks traded their best player and the future of the franchise, Madison Square Garden, the Knicks sports and entertainment company, announced its Q2 results for the year. 2019. (MSG's fiscal year begins in July.) The results were much more exciting for investors than investors, especially fans of the team that was constantly losing.
Total revenues were $ 632 million, up 18% from the same period last year. Revenues from the company's sports arm, which controls the New York Rangers in the NHL, in addition to the Knicks and the famous Manhattan arena where they both play, rose 19 percent to $ 315 million. The MSG share price remained stable at around $ 278 during the February 1 trading.
Meanwhile, Knicks fans expressed their exasperation with MSG CEO and MSG President James Dolan's social media after the team traded Latvian player Kristaps Porzingis to the Dallas Mavericks yesterday in exchange for the A package of lower quality players and two future futures. drafts.
Nevertheless, today, the company attributes its strong growth to an increase in the number of tickets sold and the price of tickets, to the lucrative concerts it organizes at Madison Square Garden, including the very popular "Christmas Spectacular". Featuring Rockettes. Investors are also optimistic about the futuristic "Sphere" conference rooms that the company builds in Las Vegas and London.
Knicks fans do not care about that. They care about the fact that their team is literally the worst in the NBA and has just packed its most promising player.
MSG President Andrew Lustgarten (who has a surprising last name for one of The Garden's top executives) made an exception to his rule of commercial discussion of the calls for results to explain the reasoning of the team behind the takeover of Porzingis.
"We do not usually talk about player movement during these calls. We do not think it's appropriate, "he said. "That said, it's a very big problem. We are thinking of staying exactly where we are going on our way. We are trying to build champion caliber franchises. Lustgarten added that the maneuver gave the team "tremendous financial flexibility" in its quest for free-standing superstar land during the summer. (My colleague Oliver Staley explained why he thinks this strategy is unlikely to be successful.)
See the ongoing Knicks disaster (the team has a record of 10-40, its worst league result, and will miss the playoffs for the sixth consecutive season) in light of the flourishing business of its parent company, which highlights a strange reality in American sport: The team on the field of play or in the field is often not correlated with the success of the team as a financial pursuit.
According to Forbes, the Knicks are the most useful team in the NBA despite its mismanagement. The situation is similar in the National Football League: the Browns of Cleveland, long the laughing stock of the league (although they have overthrown it this year), are actually a pretty strong affair.
Such facts will not comfort the Knicks fans, hoping that the team will miraculously detach from its decades-old rut. As long as Madison Square Garden Company succeeds, Dolan has little need to overhaul the way he has been leading the Knicks for much of the last twenty years.
MSG and the Knicks prove that it is possible to increase the value of a business while simultaneously launching a sports franchise. If the fans of the team want something to change, they should hope for a new direction. (MSG plans to turn the Knicks and Rangers into a separate company, but the Dolan family will retain control.)
Or they could simply search the nets.
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