Marketing mavens were sure that Donald Trump’s flame-throwing presidential campaign would hobble his knack for making money. But the presumptive GOP nominee’s new financial results show that the experts have been just as wrong predicting Trump business demise as they were at forecasting the collapse of his maverick run for the White House.
The numbers, which were released this week, show a gigantic, over-the-top 50% jump in revenues, from activities as varied as selling downtown trophy condos, filling hotel suites at his resorts, and attracting golf-crazy vacationers. To be sure, we still don’t have the full picture, far from it. What’s more, how much profit Trump actually generates from the reported sales bonanza is still in doubt. But from what Trump’s telling us, while sales at the average company in the S&P looked stale last year, dropping 3% last year year, the Donald’s enterprises appear to be as fresh as ever.
It wasn’t predicted to turn out this way. When the Donald Trump descended the escalator at Trump Tower last June, he launched his candidacy by unleashing incendiary remarks about Mexican immigrants. Within days, Trump’s corporate sponsors and clients were fleeing.
Macy’s dropped the Trump menswear line, announcing that it “values diversity and does not agree with the recent statements made by Mr. Trump.” NBCUniversal terminated its 12-year old partnership with Trump and his Miss Universe franchise, and Univision cancelled a deal to broadcast the pageant. Nascar dropped plans to hold its end-of-season awards ceremony at Trump’s golf club in Miami. And the PGA pulled the Grand Slam of Golf from his course in Los Angeles. Perfumania, America’s largest perfume retailer, scuttled its two Trump fragrances––Success by Trump and Empire by Trump. Mattress-maker Serta refused to take the insults lying down, scuttling its line of $3,000 Trump Home mattresses.
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None of that seems to have held back Trump Inc. In the press release that accompanied his new Personal Financial Disclosure (PDF) filing with the Federal Election Commission, Trump states that his revenue, “which does not include dividends, interest, capital gains, rents and royalties,” rose by “approximately $190 million,” compared to receipts in the same categories in the previous filing, from $362 million to $557 million. (It’s actually $195 million—a rise of 53%.)
There are some caveats here. The periods covered by the two filings actually overlap. The initial PDF, submitted on July 15 of last year, spanned 18 1/2 months, from the start of 2014, to the date of the filing. The new PDF encompasses all of 2015, and includes the first 4 1/2 months of this year, up to the May 18th submission. As a result, there appears to be some double counting. (For example, speaking fees of $800,000 in the first four months of 2015 are included in both reports.) What’s more it appears some of what Trump claims as income, which is really revenue, appears to be spending by his own campaign. Revenue from leasing out one of his planes rose to $3.7 million. But that’s likely money that was spent by Trump’s own campaign for usage of the plane, as others have pointed out. And since has up until this point been self funding his campaign, it’s odd to count that as income for Trump.
What’s more, some Trump businesses have suffered. In the most recent period, Trump reported that revenue from his menswear line was $100,000 to $1 million. That’s down from $1 million to $5 million a year ago.
But even factoring that all in, Trump, and his businesses, appear to have done very well in the past year. If anything, the improvement looks all the more impressive, since the $557 million that was booked in the the most recent period was generated over a shorter period—16 1/2 months versus 18 1/2 months.
The robust rise didn’t result from developing new ventures or properties. His holdings are practically identical to roster in the past report. The big buckets touted in the release are revenues at his golf courses and hotels, sales of condominiums, and fees for managing condo, office buildings, not to mention a famous skating emporium, and the sale of a world-famous beauty pageant. And it’s important to note that the figures Trump trumpets exclude a big part of his total sales. A major portion of his revenues. as much as one-half, come from office and condo rentals. royalties, all of which are excluded from the $557 million.
Instead, the story, it appears, of Trump’s strong performance in the past year is of improvements in his existing businesses. In fact, of the forty developments, golf courses, and the like with the largest revenues, no fewer than 34 showed improved sales, while four declined, and one showed no change. Just about the only notable new venture is his management contract for the architecturally avant-garde, sail-shaped Trump Baku in Azerbaijan ($322,000 in fees). Even sales of Trump Ice, his water company, rose, up 48%, to nearly $415,000.
It’s Trump’s portfolio of fifteen golf courses that provided the big push. Their revenues jumped from $195 million to $318 million, accounting for two-thirds of the total improvement. The star is the Trump National Doral Miami. Trump bought the Doral in 2012 for $150 million, and launched a $250 renovation project to rework its famous “Blue Monster” course, refurbish over 600 guest rooms and suites. He also erected a tony clubhouse festooned with Swarovski crystal chandeliers, spanning 175,000 square feet of restaurants, patios, and pools. He also added a fifth golf course to the 800-acre resort, the full expansion managed by Trump’s son Eric.
And, as it turns out, the PGA isn’t boycotting Trump properties. Duffer Aaron Scott just captured the WGC-Cadillac Championships at the Doral in early June. Over the report’s year and four-and-a-half-months, the Doral’s “golf course related revenues” surged from $49.5 million to $132 million. Sounds great. But given the huge investments, it’s not clear whether Trump is collecting enough revenue, and booking big enough margins on that revenue, to make the Doral a lasting profit-maker.
Building and selling luxury condos is a staple business for Trump. And the report illustrates how as projects wind down, Trump has been able to line up new projects to buffer the decline. For instance, in the previous filing, Trump International Hotel & Tower in downtown Chicago reported $43 million in condo sales. This year, that figure fell to less than $1 million. But in Manhattan, buyers paid $44.3 million for residences at Trump Park Avenue, $33 million more than in the prior period. Trump started redeveloping the property—the former Delmonico Hotel at 59th Street and Park Ave.—in 2002, but just in the past year decided to flip a number of apartments he had shrewdly kept as rentals.
A surprise in the filing was the disclosure of the sales price for the Miss Universe Organization, which includes the Miss USA and Miss Teen USA pageants. Last summer, Trump dropped a $500 million lawsuit against NBCUniversal for canceling their partnership, and bought NBC’s 50% share to become sold owner. He then flipped the beauty franchise to talent agency WME/IMG. Price for everything, newly reported in the PDF: $49.3 million. Once again, it’s impossible to say if Trump made money. NBC did not disclose what Trump paid for its half-interest. But there is one telling sign: the Donald did not make his usual claims about clinching a killer deal.
Trump is even prospering a few blocks from Trump Tower, in Central Park. More tykes than ever are flocking to the Trump Carousel, the revolving equestrian extravaganza that he restored, and has been managing since 2010. In the most recent period, it booked $703,000 in sales, up 20%. At the nearby Wollman Rink, the ice skating attraction Trump also runs, ticket sales leapt from $8.5 to $12.9 million. Even when it rains, instead of snows, Trump seems to be able to figure out how to, well, make more money.
Sure, these look like terrific numbers. But once again, they’re only part of the picture. The new filing also presents fresh data on royalties, especially Trump’s most important source of revenue—office and condo rents. We promise a update on what all those figures, taken together, say about the claim that’s repeated in the new press release, that “Mr. Trump’s net worth is in excess of $10 billion.” In fact, Trump’s campaign says his massive, and already hard to justify, net worth has gone up in the past year. That seems hard to believe, but the way Trump’s brand defies gravity, we may soon marvel at the bulky tycoon floating airborne into the lobby of Trump Tower, sans escalator.