After operating at a loss last fiscal year, Mizzou athletics sees bump in ticket sales

In large part because of lagging ticket sales last fiscal year, Missouri’s athletic department operated at a loss for the first time as a member of the Southeastern Conference. Missouri last operated at a deficit during the 2011-12 fiscal year, the school’s final year in the Big 12 Conference.

According to figures included in the school’s submission to the NCAA Membership Financial Reporting System, Mizzou generated $97,848,195 during the 2017 fiscal year, athletic director Jim Sterk’s first year at the school. That’s less than 1 percent increase from the previous year. The department spent $102,409,131, from July 1, 2016 through June 30, 2017, which is a 8.6 percent increase from the year before.

The report encompassed Barry Odom’s 4-8 debut season as the Tigers’ head football coach and Kim Anderson’s third season struggling as Missouri’s men’s basketball coach.

Things are rosier for MU now. The football team won its final six regular-season games and earned a bowl berth, and quarterback Drew Lock is returning for his senior season. Coach Cuonzo Martin’s basketball team is a NCAA Tournament contender.

“We’ve kind of gotten the fan base back on that,” said Jay Luksis, Missouri’s senior associate athletic director of marketing and revenue generation. “We’ve got basketball rolling now. Football is coming right behind it.”

So there’s hope that MU can rebound from ticket revenue shrinking from $19,152,889 to just less than $18 million. The previous fiscal year included a $3.5 million payout from Arrowhead Events for a game the Tigers played against BYU in November 2015, which is part of the reason for the drop-off.

The university’s enrollment is also still recovering from the downturn it experienced that same November, after campus protests and a football team boycott made national news.

“It takes time either on the athletic side or the university side,” Luksis said. “Obviously we all want to move forward. I do think it helps. It gives alumni and the community (a reason) to come back.”

Even as Missouri found football success again this past season, attendance at home games remained mostly the same. Football attendance was actually slightly worse in Odom’s second year compared to his first — 52,236 compared to 51,490 in the 2017 season, when the Tigers started 1-5. Luksis said he thought that was because the season was almost over once the team’s “turnaround” seemed legitimate.

“We did a lot of winning late, late in the year,” Luksis said. “I think if you flip the schedule and we started that way, obviously it would’ve been a different uptick in sales. But I expect that going into next year.”

The athletic department’s chief financial officer, Tim Hickman, said it is possible that the department will be in the red during fiscal year 2018, too — though not certainly. He said the university’s financial struggles do not work in lockstep with the athletic department’s.

“Football went down a little bit. Basketball went down,” Hickman said. “So those were down, which pulls all of our revenue sources down, whether it’s concessions, parking, royalties, things like that.”

Hickman said the department is still waiting on clarification from an outside consulting firm, PricewaterhouseCoopers, regarding how the new federal tax bill will affect finances. The new tax law eliminates the deductions boosters have been able to take on donations tied to season tickets. It also imposes a tax on seven-figure salaries for employees of nonprofits.

“They’re supposed to be giving us their opinion on what that means,” Hickman said of the consulting firm. “So I don’t have that yet.”

The department’s greatest source of revenue came from its media rights deals. Those netted about $34.76 million, compared to approximately $33.5 million the year before.

Donor contributions also increased from approximately $17.8 million to $22,355,552 in Sterk’s first year. And that doesn’t include money earmarked for future projects, such as Mizzou’s planned south end zone facility for the football program.

Football ticket revenue dropped from about $13.28 million to approximately $11.05 million in the 2017 fiscal year.

In Anderson’s final season as the Tigers’ coach, men’s basketball ticket-sale revenue dropped from approximately $3.73 million to about $3.03 million.

MU will see its basketball ticket revenue number rise in its next report to the NCAA. With fans hoping to see freshman Michael Porter Jr. play, the team sold out of season tickets. Porter has since undergone back surgery, but every home game has still had a reported attendance of 15,061, which is Mizzou Arena’s capacity. The Tigers lead the country in year-to-year average attendance increase, according to the NCAA’s data, which also factors in teams’ non-home games.

“Going out there and seeing how many people are behind us, how many people support us, it’s a great thing,” junior forward Kevin Puryear said. “Of course, there’s a lot of new faces, but we’re glad. We’re welcoming all types of Missouri fans this year.”

Martin’s salary was included in the 2017 fiscal numbers. MU spent $4.96 million on his salary and benefits, compared to $1.51 for Anderson the previous year. Also, under Martin, the salary/benefits pool for assistant basketball coaches rose more than $300,000 from what is was under Anderson, to $972,247.

At a department-wide level, Missouri spent $21,107,952 on coaches’ salaries, expenses and benefits. That’s up from about $18.56 million the year before.

The department received a $1.015 million subsidy from the university, which is the same as the previous year. A USA Today database built with last year’s financial reports sent to the NCAA listed that as the 21st smallest amount of any school in the country — including 14 athletic departments that take no subsidy. Eight SEC schools took less of a subsidy from their school than MU does, according to the database.

Hickman said the department’s overhead and administrative costs — which rose by more than $5 million to approximately $14.6 million — could decline again. The rise was associated with the construction of Missouri’s new softball stadium.

“We will eventually have the south end zone stuff too,” Hickman said. “But with the way the softball project worked, all the expense hit in that year.”

This story was originally published January 25, 2018 at 12:03 PM with the headline "After operating at a loss last fiscal year, Mizzou athletics sees bump in ticket sales."