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Saturday, June 20, 2009
Global Finances Steadily Declined
By Rosalie Rayburn
Journal Staff Writer
Global Entertainment's tenure as management company for the Santa Ana Star Center was marked by high hopes, canceled events and losses.
The Arizona-based company managed the 6,500-seat arena from the time it opened in late 2006 until Feb. 1 this year.
Over that same period, the company saw its own financial position decline. In annual reports filed with the Securities and Exchange Commission, the company reported net income for the fiscal year that ended May 31, 2006 of $245,055, down from $435,761 the year before. The company reported a net loss of $4.1 million in 2007 and a net loss of $4 million in 2008.
Global stock was listed on the American Stock Exchange (AMEX) under the symbol GEE, between January 2006 and April this year.
Rio Rancho signed a 10-year contract with Global in 2004 to manage the Star Center. At the time, Global predicted the center would yield profits of $1.6 million in its first year. Instead it suffered a $241,000 loss. By the end of 2008, the losses mounted to $580,000.
The situation prompted the city to terminate Global's contract. The city awarded a new management contract to Philadelphia-based Global Spectrum, which took over the Star Center on April 1.
Global Entertainment has been fired from other arena contracts, too. Early this month, the city of Wenatchee, Wash. terminated the company's contract to manage that city's Town Toyota Center, citing poor accounting practices. Global Spectrum is one of six companies that have expressed interest in taking over at the Toyota Center, according to a published report.
In 2007, the city of Youngstown, Ohio cut its ties with Global Entertainment subsidiary International Coliseums Co. in October 2007 following a dispute over guarantee money the city claimed the company owed related to its management of that city's Chevrolet Centre.
