Reports: New Coyotes ownership suffered losses of $16 million in first fiscal year (Updated)

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The new Arizona Coyotes ownership group on Friday gave an update on the team’s financial status.

From FOX Sports Arizona:

The Coyotes ownership group reported its Fiscal Year 1 losses to the City of Glendale on Friday, and the number was alarming to everyone but the team.

Coyotes president and CEO Anthony LeBlanc said the team lost $16.458 million, but for Generally Accepted Accounting Principles (GAAP), it also had to include its one-time acquisition and closing costs ($7.878 million), along with the complete amount of the Mike Ribeiro buyout ($10.495 million), bringing the total operating loss to $34.831 million.

The latter is the figure that counts toward the team’s oft-mentioned “out clause,” which can be exercised within a 180-day window after five years and allows the team to leave Arizona if it reaches or exceeds $50 million in losses. The $50 million threshold is just a gating factor, not an automatic trigger for the out clause. There are many other determining factors.

It was initially reported the loss for the first fiscal year was about $16.6 million.

The Coyotes organization has been in a lengthy state of flux, with the NHL approving the sale of the majority stake in the franchise to Andrew Barroway at the end of December.

There have been rumors of Barroway possibly flipping the franchise to someone who would look to relocate it, and Barroway shooting down those rumors.

On the ice, the Coyotes are in the midst of a rebuild, after veterans Antoine Vermette and Keith Yandle were traded prior to the deadline earlier this month. And, as GM Don Maloney mentioned in January, this might mean some “suffering” in the shorter term.

The message from Friday’s update seems to be that the ownership group expects profitability, although it remains to be seen exactly when that could happen.

Meanwhile, the Coyotes do have an out-clause if they lose $50 million over the first five seasons.