Leaders at Los Angeles Opera are breathing a little easier now that a huge financial burden has been lifted from their shoulders.
L.A. Opera is announcing Wednesday that it has fully repaid a $14 million emergency loan it received in 2009, a loan obtained with the help of Los Angeles County. With this step, the company is now looking forward, hoping to add more productions to future seasons and mix in more contemporary operas.
The opera company repaid half of the principal in January in order to save money on interest payments. The remaining $7 million was paid on Tuesday, according to Christopher Koelsch, president and chief executive of L.A. Opera.
"It significantly improves our long term-debt position. It's wonderful to have this behind us," Koelsch said in an interview.
L.A. Opera received the loan at a time when it was in the midst of its $31 million production of Wagner's "Ring" cycle operas and in the depths of the country's economic crisis. At the time, the company said it needed the money to stay afloat and meet short-term expenses.
The loan came from a Bank of America unit and was guaranteed by the L.A. County Board of Supervisors.
L.A. Opera raised the money to pay back the loan from donor pledges. Marc Stern, the chairman of the opera's board of directors, said in an interview he is "cautiously optimistic" about the company's financial health.
"Getting this part of our debt structure behind us is an enormous upgrade to our financial health," he said. He added that the company is grateful to the county for arranging the loan.
Looking ahead, Stern said L.A. Opera will begin "to get involved in contemporary works, balancing that with traditional opera. That's certainly what our goal is." He also said the company is aiming to increase the number of its main-stage productions from the current six per season.
L.A. Opera isn't entirely out of the woods in terms of debt. The company said it still owes approximately $6 million to donors, at no interest. It also has a loan from the Music Center for $2 million. The company has a regular revolving line of credit of $8 million with Bank of the West.
Box-office results so far this season are higher than last season, according to Koelsch. He said that ticket sales so far this season are about $1 million higher than at the same point last season.
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