Slide 1: By Greg Patterson Kate Livesey John Watson

Slide 2:Agenda Senators Now… Issues to be solved Background - Ottawa Senators and Corel Center Problems Involved The Senators and The Corel Center NHL in Canada Financials and sensitivity analysis Recommendations Conclusions

Slide 3:The Senators now… Established on December 6, 1990 Last year they clinched a playoff spot 2 Seasons highs – goals scored They finished 41-30-11-2 with 95 points Finished 2nd in the Northeast Division (5 points Behind Toronto!!!) Averaged 17,509 fans/game (out of a possible 18,500 fans), 13 sell-outs, 3% growth rate in attendance.

Slide 4:Issues to be solved… Question #1: What are some of the negative factors affecting the Ottawa Senators and the Corel Center currently? Question #2: Are the Ottawa Senators and the Corel Center a profitable investment? Question #3: Regardless of whether or not it’s profitable, what are some possible recommendations to make it more profitable?

Slide 5:Background A vision was formed…NHL in Ottawa A letter was written Press Conference Plans unveiled for Kanata, 600 Acres Horizon Investments & David Peterson - Full support Horizon receives invitation 100 acres rezoned for MCF

Slide 6:To get a Perspective…

Slide 7:Horizon Development Plan Legend:   Green: Hi-tech sector Yellow: Residential Red: Palladium Pink: Shopping

Slide 8:Background Cont… 11,000 pledges for seasons tickets Lease negotiated with Civic Center Horizon Officials, 150 Supporters,marching band travel to Palm Beach 45 min. presentation to board of Governors Awarded the NHL franchise

Slide 9:Problems The tough taxes (PAT, GST,PST, property, infrastructure) which give American teams a benefit over Canadian teams. TV Rights (National vs. Local) West Side of the Corel Center (no signage) US/CAN exchange differential (Cdn$64.5 / US$1)

Slide 10:1) Do these problems cause the Ottawa Senators and Corel Center to be an unprofitable investment?

Slide 11:Some Numbers…

Slide 12:Financial Data Stable Growth Model Spreadsheet Assumptions Sensitivity Analysis Value of the firm The future of the Ottawa Senators and Corel Center If everything remains the same EBITDA

Slide 13:Why else would one buy the Ottawa Senators and Corel Center? Core Competencies: Winning games: points, good quality players Having different events at the Corel Center Excellent Management–tight budgets, good marketing and signage Excellent marketing with manipulation of the Senators appearance Use to be “Come see your favourite team play the Senators”, Now it’s “Come see the Senators”

Slide 14:Why else? 30% population growth over the next 10 years. Ottawa is the third largest tourist city in Canada with many tourist attractions including museums, Winterlude, beautiful parliament buildings, etc. Large population within 70 mile radius Major international airport Government workers and high-tech

Slide 15:Recommendations Treat owning a hockey team like owning a business, apply all other business practices you would if you wanted it to be profitable. -“You’re selling sizzle not steak” - Barb Smith. It’s a service industry

Slide 16:Recommendations Cont’d. Pro-Line sharing profits (trademark) Lobbying TV rights (National vs. Local) Signage on West side Taxes (amusement, infrastructure) Gambling on-line: NHL.com Hockey Channel or website NBA to share the Corel Center

Slide 17:Recommendations Cont’d…Marketing and Sales Strategies Market to higher salaried individuals Want to teach viewers that keeping salaries down keep ticket prices down: increase the happiness our fans if they understand and also make them understand with an increase in salaries the fans have to pay for it. Sale and Lease Back to City

Slide 18:Ottawa loves its hockey!!! All the difficulties Economic Impact

Slide 19:Conclusions Value of the firm is positive The EBITDA will be positive this year if Senators make the playoffs Ottawa is a good market for another Professional sports team -> Increased Profits The team and building weren’t bought to make money on, it was bought to increase the value of the surrounding land therefore increasing their profits on the whole.

Slide 20:The End