NY's Metropolitan Opera reports 2009 fiscal woes
June 17, 2010 The company finished the year with its net worth down
substantially and sizable debts looming in coming years. In
financial statements, filed on Monday, the opera house listed net
assets of $236 million, down from $380 million a year earlier.
Like many major arts organizations, the Met has been struggling
to maintain artistic quality and innovation while riding an
economic roller coaster.
"Since the costs of running the world's biggest opera house
have always been greater than its earned revenues, the Met has
regularly faced enormous financial challenges throughout its
history," General Manager Peter Gelb told The Associated Press.
In the first year of the recession, 2008, a company counting on
good investment returns didn't get them. The Met wound up
scrambling for operating money just as lavish new productions were
being staged under the new leadership of Gelb, who became general
manager in 2006.
Despite the gloomy financial picture, the company spent more in
its 2009 fiscal year than it had a year earlier. Salaries rose by
more than $6 million.
Meanwhile, the opera's investment portfolios dropped in value.
The organization's financial statements listed $40.8 million in
losses, after expenses and dividends, in fiscal 2009 compared to a
$14.3 million loss a year earlier. The opera's pension fund lost
$20 million in investments.
The financial filings also appear to show a drop in donor
support, although Met spokesman Peter Clark said that, overall,
gifts have increased in recent years, including a 5 percent
increase through the current season. Contributions and grants were
listed as falling to $105 million, from $164 million.
Met officials have taken steps in the past half-year to trim
expenses and boost revenue.
Stagehands who had been due a 2.5 percent salary raise in June
delayed it until the 2010-11 season. And to help cover operating
costs on a short-term basis, the opera was forced to dip into its
endowment. It asked several donors to ease restrictions on how
their gifts could be spent, freeing up $22 million.
A gift of $30 million from philanthropist Ann Ziff was announced
in March, with most of the money available this year and the rest
over the next four years. The gift from Ziff, whose husband was the
publishing executive William Ziff and whose mother was the soprano
Harriet Henders, is the largest in the institution's history.
Early in 2009, Gelb replaced four planned major revivals for the
2009-10 season with productions of standard repertory less
expensive to rehearse and stage.
Some financial pressures still loom for the organization,
including a $35 million back loan due to be repaid in 2011 and a
$57 million pension plan deficit.
Gelb said the Met has attracted larger audiences worldwide with
productions such as Rossini's "Armida," starring soprano Renee
Fleming, and Verdi's "Attila," with costumes by designer Miuccia
Prada, which helped boost attendance to 88 percent of paid capacity
last season, up about 10 percent over the average of the previous
few years.
High-definition movie theater broadcasts, which the Met spent
$4.5 million developing, are now also earning a modest profit.
"The Met has managed through difficult times in the past,"
Gelb said. "Now, by increasing the public's interest in opera with
our recent artistic successes and public initiatives, we are
confident that we will thrive in the future, as well."