Pac-12 announces 2017-18 financial results

Pac-12 Conference
Consolidated revenue reported at $497M with total distributions at $354M
 
Five-year period since start of ESPN and Fox deals and launch of Pac-12 Networks marked by 55% growth in member distributions and 49% growth in revenues
 
Conference Expenses reported at $40M, placing the Conference in the middle of its Autonomy Five peer group in annual expenses
 
SAN FRANCISCO – May 20, 2019 – The Pac-12 Conference today reported the financial performance for the financial year 2017-2018, highlighted by total revenues of $497M and distributions at $354M, representing an average of $29.5M per member university.  The year-on-year decrease in reported revenues and distributions is a result of the Rose Bowl and its associated revenue being part of the College Football Playoff in fiscal year 2017-2018. Actual cash distributions for fiscal year 2017-2018 were $376M as a result of cash received from the Rose Bowl during fiscal years 2015-2016 and 2016-2017 being reserved for future cash distributions when the Rose Bowl is part of the CFP.  Average cash distributions were $31.3M per member university, resulting in an increase of 5% year-on-year (see three year chart set forth below).  The equity value of the Pac-12’s full ownership of its Pac-12 Networks is not included in reported results.
 
For the five-year period since 2012-2013 when the Pac-12 began its media rights agreements with ESPN and Fox and launched the first and only member-owned conference network, annual member distributions have increased by 55% ($228M to $354M) and annual total revenues have increased by 49% ($334M to $497M).  The compounded annual growth rate for member distributions and total revenues over the five-year period was 9% and 8%, respectively.  The ESPN and Fox deals signed in 2012 resulted in more than four times the annual revenue of the prior Pac-12 media deals.
 
For the first time, in addition to reporting consolidated results and in order to provide enhanced clarity and transparency, the Pac-12 is providing a breakout of each of Conference and Networks performance (see chart set forth below).   For 2017-2018, the Pac-12 Conference reported revenues of $370M and net operating expenses of $40M.  For 2017-2018, the Pac-12 Networks reported revenues of $127M and net operating expenses of $101M.  Consolidated expenses for the Conference and Networks together increased by 1% year-on-year.  The Conference’s annual expenses place it in the middle of its Autonomy Five peer group in terms of level of annual operating expenses as reported in publicly available Form 990s.
 
“Supporting the academic and athletic missions of our member Universities, along with the health and well-being of our student-athletes, is our number one priority,” said Pac-12 Commissioner Larry Scott.  “We are pleased with our growth over the past several years, and are committed to maximizing value to serve this central purpose.  This includes through our media strategy under which we own and control our Pac-12 Networks and have aligned our ESPN and Fox deals with our Pac-12 Networks deals to be able to bring our full package of media rights to the market in 2024.”
 
“Our Pac-12 CEO Group remains confident in the future success and growth of the Conference, in part because of our media strategy and the value we believe this will deliver to our universities to support our educational mission, athletic goals and thousands of student-athletes,” said Philip DiStefano, Chair of the Pac-12 CEO Group and Chancellor of the University of Colorado, Boulder.  “We will be well-positioned for 2024.”
 
The Pac-12 Networks is the only conference network wholly-owned and controlled by its university members, providing an unprecedented platform to showcase the full breadth of Pac-12 sports to fans nationally across linear, digital and social platforms.  The ownership model, under which the universities retain full equity in the enterprise, also provides a platform for innovation and the flexibility to adapt to and achieve full value from a rapidly evolving media landscape.  Revenue and expenses, but not equity value, from the Pac-12 Networks are included in the Conference’s reported financial results.
 
Pac-12 Conference Distribution Reconciliation
Note: Cash received from the Rose Bowl has been reserved in 2016 & 2017 to provide consistent distributions in years Rose Bowl is part of CFP.
 
 
2016
2017
2018
Rose Bowl Revenue
 
 
 
Audited Book Revenue
 35,437,831
 36,523,831
 14,064
Rose Bowl Revenue Reserve
 (11,417,488)
 (13,153,298)
 22,251,839
Revenue for Distributions
 24,020,343
 23,370,533
 22,265,903
 
 
 
 
Distributions
 
 
 
Audited Book Distributions
 343,944,838
 371,369,371
 353,814,284
Rose Bowl Revenue Reserve
 (11,417,488)
 (13,153,298)
 22,251,839
Cash Distributions
 332,527,351
 358,216,073
 376,066,123
 
Pac-12 Conference 990 Reporting by Entity 
(Source: Audited Financial Statements)
 
 
 Networks
 Conference
 Consolidated
Revenues
 
 
 
All Other Contributions
 10,030,287
 288,784
 10,319,071
Non-Cash Contributions
 200,000
 -  
 200,000
Television Rights Fees
 98,895,457
 240,180,598
 339,076,055
Post Season Bowls
 -  
 84,171,515
 84,171,515
NCAA Funds/Conf Event
 -  
 40,217,634
 40,217,634
Advertising
 15,169,455
 -  
 15,169,455
Other Revenue
 2,665,374
 4,648,867
 7,314,241
Investment Income
 -  
 454,411
 454,411
Gain or (loss)
 -  
 8,219
 8,219
 
 
 
 
Total Revenue
 126,960,573
 369,970,028
 496,930,601
 
 
 
 
Expenses
 
 
 
Compensation of current officers, directors, trustees and key employees (including nontaxable benefits)
 1,506,075
 5,994,701
 7,500,776
Other salaries and wages
 21,261,795
 4,834,113
 26,095,908
Pension plan accruals and contributions (employer portion)
 652,388
 567,186
 1,219,574
Other employee benefits
 2,452,296
 1,036,242
 3,488,538
Payroll taxes
 1,517,671
 420,316
 1,937,987
Legal fees
 2,060,120
 2,558,270
 4,618,390
Accounting fees
 -  
 77,243
 77,243
Other
 7,984,392
 947,634
 8,932,026
Advertising and promotion
 1,866,209
 970,758
 2,836,967
Office expenses
 424,834
 159,489
 584,322
Information technology
 10,639,019
 98,420
 10,737,439
Occupancy
 6,909,948
 1,181,439
 8,091,386
Travel
 830,068
 1,405,418
 2,235,486
Conferences, conventions and meetings
 118,551
 619,490
 738,041
Depreciation, depletion and amortization
 31,414,228
 698,343
 32,112,571
Insurance
 864,323
 1,344,661
 2,208,984
Conference Events
 -  
 8,130,164
 8,130,164
Programming & Digital
 4,065,202
 -  
 4,065,202
Officiating
 -  
 2,599,455
 2,599,455
Research and Education
 -  
 3,553,332
 3,553,332
All other expenses
 6,166,056
 2,733,197
 8,899,253
 
 
 
 
Total Expenses
 100,733,174
 39,929,872
 140,663,046
 
 
 
 
Grants to domestic organizations (Schools)
 -  
 353,814,284
 353,814,284
Grants to domestic organizations (Womens Sports Foundation)
 -  
 25,000
 25,000
 
 
 
 
Total Expenses
 100,733,174
 393,769,156
 494,502,330
 
 
 
 
Revenues Less Expenses
 26,227,399
 (23,799,128)
 2,428,271
 
Notes:
 
  • Certain allocations of expenses are made between Conference and Networks budgets to account for shared services and facilities, as well as for certain limited personnel roles that have responsibilities across both Conference and Networks.
  • “Other” Networks expenses includes talent, research, temporary and freelance labor and consulting; and “Other” Conference expenses includes temporary labor, consulting and special projects
  • “All Other Expenses” primarily includes taxes, sales expense, equipment supplies and maintenance, and officiating
About the Pac-12 Conference
The Conference has a tradition as the “Conference of Champions,” leading the nation in NCAA Championships in 52 of the last 58 years, with 523 NCAA team titles overall. The Conference comprises 12 leading U.S. universities - the University of Arizona, Arizona State University, the University of California, Berkeley, the University of California at Los Angeles (UCLA), the University of Colorado, the University of Oregon, Oregon State University, Stanford University, the University of Southern California, the University of Utah, the University of Washington and Washington State University. For more information on the Conference’s programs, member institutions, and Commissioner Larry Scott, go to Pac-12.com/conference.

 

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