Kent’s ShoWare Center turns profit in first quarter of 2013

The profits are coming.

That’s the message ShoWare Center officials are sending after the arena turned a profit of $7,048 for the first quarter of 2013 and could be on the path to its first profitable year since the arena opened in 2009.

“We look like we’re going to hit budget for the year and, hopefully, a little bit better than budget for the year,” said Patrick McCluskey, ShoWare finance director, during an interview last week.

The city-owned arena had income of $676,188 and expenses of $669,140 for the first three months. ShoWare officials had projected a loss of $58,201 for the first quarter. ShoWare turned its first profitable quarter since the first quarter of 2011.

“We’re $65,000 over budget and $7,000 in the black,” McCluskey said.

The unexpected revenue boost came from two Seattle Thunderbirds junior hockey playoff games in March; higher than projected attendance at two Harlem Globetrotters shows in February; and large ticket sales for the Pandora Unforgettable Moments of Love on Ice show featuring singer Barry Manilow in January.

“Those three categories were the reason we were $75,000 over budget for event income,” McCluskey said.

The income statement for the $84.5 million arena provided great news for city officials. The city sets aside money in its annual capital budget fund to cover the losses at the arena. That money could be used to help pay for improvements to city streets, facilities and other capital projects.

“Obviously, we’re very pleased,” said Ben Wolters, city economic and community development director. “The first quarter was a strong one for us. We had a lot of events that got a lot of attention for us from the Love on Ice with Barry Manilow to the playoff run by the Thunderbirds and other events.”

The Thunderbirds drew a total of 8,580 fans to the two playoff games. The Globetrotters two shows attracted 8,572 fans. Love on Ice drew 4,167 fans.

The Thunderbirds advanced to the Western Hockey League playoffs for the first time in four years. They were eliminated by Kelowna in the first round. The T-Birds played one home playoff game in April that drew 4,344 fans and will count toward the second-quarter budget.

“We budget the 36 regular season games plus the preseason so anything above and beyond with the playoffs is extra revenue for the building,” McCluskey said.

The larger crowds mean more ticket revenue as well as more revenue from food and beverage sales ($22,215 over budget for the first quarter).

The Globetrotters usually do only one show in Kent. The two performances, on a Saturday afternoon and evening, each turned out to be hits.

“We knew it was in the budget as two events but we thought one might take away from the other but they both sold well so that helped out quite a bit,” McCluskey said. “Love on Ice with Barry Manilow sold very well, better than budget.”

The arena lost $2.013 million during its first four years of operation, including a record-setting loss of $706,432 in 2012. SMG, which operates the facility, had projected a loss of $495,000 in 2013 at the start of this year.

But with the profitable first quarter and an anticipated three or four major concerts in the last two quarters of this year, the outlook appears to be positive. McCluskey expects the second quarter to hit budget with a big boost in the final two quarters.

“The third and fourth quarter with more concerts should, hopefully, push us over budget,” said McCluskey, who added that ShoWare general manager Tim Higgins is close to lining up some major concerts.

Concerts help with profits through additional ticket sales, rent revenue and food and beverage sales.

“If it’s a good concert, people are buying a lot of food and beverages,” McCluskey said.

Wolters agreed the future looks bright for the arena.

“The building looks to be busy going forward,” Wolters said. “We’re very pleased that we’re seeing a real uptick in activity at the ShoWare Center and it’s starting to show on the bottom line.”