Eli S. Jacobs, Orioles owner since plunking down $70 million in 1989, seems to be getting his money's worth.
Not only is his plucky baseball team among the leaders in the American League East Division; it also appears to be delivering on the bottom line.
Documents labeled "The Orioles, Inc., Budget, 1992" and dated Oct. 25, 1991, show the team projected its operating profit this year to more than double from last year to $18.4 million.
As the season unfolds, the figures could look even better, thanks to a run on the Camden Yards ticket office that exceeds what the budget documents predicted in October. If the season continues as it began, added ticket and concessions revenue could boost operating profit above $20 million. Operating profit is the difference between revenue and expenses associated with the business' regular, ongoing activity of a business. It does not include suchitems as interest or amortization costs.
The expected increase in operating profit, to $18.4 million, is about four times the profit from 1989, when Mr. Jacobs bought the team, according to the budget documents. People familiar with the business side of the sport say the latest projections would move the Orioles from the middle ranks to among the top teams in baseball.
Mr. Jacobs and Orioles President Larry Lucchino so far have declined to discuss any of the projections. Contacted Thursday, the Orioles requested that The Sun provide the budget documents to the club. Because it is the numbers -- and not the document itself -- that are the issue, The Sun declined to turn over the documents and instead offered to discuss the budget )) figures that would be used in this article.
The Orioles did not respond to that offer, but Mr. Lucchino issued a written statement yesterday that said: "The Baltimore Sun has in its possession an improperly obtained internal budget document of the Baltimore Orioles, and The Sun has inexplicably refused to show the Orioles a copy of that document. It is difficult, therefore, to comment or to determine whether or not the document is or is not authentic and accurate. The Orioles, as a privately held company, do not publicly discuss the details of their financial matters, much less the details of any proposed and possibly inaccurate internal document."
The projections, which might have been revised since the October documents were prepared, confirm Mr. Jacobs' reputation in financial circles as a shrewd deal maker who is adept at spotting bargains. There was no Camden Yards stadium when he bought the team, just a signed lease, architects' sketches and a predicted opening date of April 1992.
Mr. Jacobs apparently saw the financial possibilities of a ballpark loaded with profit-making amenities. Camden Yards is unmistakably long on luxury, from the 72 sky boxes with annual rents high as $95,000 to the members-only Camden Club, where the menu features such unusual ballpark dishes as herb-grilled, portabella mushroom steak.
It is the new stadium, of course, that is a major reason for the surge in projected revenue. If the aura of the new ballpark wears thin or if the team stumbles, it would be difficult to repeat the anticipated success of 1992.
Glimpses into the Orioles' finances, including the team's revenues and operating profit, have been rare since Mr. Jacobs bought the team from the family of the late Washington lawyer Edward Bennett Williams. For seven years before the sale, Baltimore city officials routinely disclosed this information, which the team provided during annual rent negotiations over use of city-owned Memorial Stadium. But Mr. Jacobs has guarded that information zealously and dissuaded city officials from disclosing The new stadium's landlord, the Maryland Stadium Authority, won't collect its first rent check for almost a year. Before the season began, state officials estimated they would collect about $4.5 million. After Opening Day, Herbert J. Belgrad, the authority chairman, revised that estimate to as much as $9 million.
With their sellouts and soaring revenues, Mr. Jacobs' Orioles are a vastly different franchise from the early teams. The first Orioles owners were a syndicate of local businessmen, including lawyers Clarence Miles and Zanvyl Krieger, who bought the lowly St. Louis Browns and moved them to Baltimore in 1954. The group paid $2.475 million for the Browns, about what the Orioles expect to earn this year from their radio contract alone.
That Opening Day, in 1954, was a sellout, but attendance soon fizzled. The early years were lean. In 1959, the team lost nearly $54,000. In 1963, team officials slashed the budget and managed to eke out a $99,262 profit.
A regional franchise