The financial reports for AFL clubs for last season are starting to come in, and early indications are that quite a few clubs are reporting good profits, including clubs which failed to make the final eight.
As far back as August, the Herald-Sun reported that Essendon was on the verge of wiping out its debt after “another exceptional financial result.”
This debt had been accumulated over the years of the supplements scandal after amassing considerable legal expenses. Essendon ended up reporting a net profit of $3.4 million from total revenue of $65 million.
In the same month, The Australian reported on what it termed the ‘$10m footy clubs’, referring to Richmond and West Coast being ready to report combined profits in excess of $10 million on the back of records crowds and memberships, with the code more generally described as being in “rude financial health”.
Richmond’s financial report disclosed a profit of $4.2 million from total revenue of $80 million. Impressive as that is, it was bested by Hawthorn, which has reported a profit of $5 million from total revenue of $74 million.
While St Kilda reported a profit of $10.1 million, this needs to be adjusted for non-operating revenues of $13.1 million which relate to the Moorabbin redevelopment. Looking specifically at operating revenues and expenses, we get an operating loss of some $2.7 million.
Last month, Western Bulldogs President, Peter Gordon, canvassed the possibility of the Bulldogs earning a record profit off the back of $55 million in revenue.
The club’s financial report as at October 2018 has just been released, and while Gordon was a little bit off with his revenue estimate, the Bulldogs are disclosing a fourth consecutive profit, which is commendable for a club finishing 13th.
The Bulldogs’ revenue remained relatively stable at $51.6 million, but a tighter handle on costs has allowed it to increase its profit for the year to $2.2 million.
Intriguingly, the Bulldogs have reported a profit after ‘Redevelopment Activities’ of $18.1 million. This has come about by the granting of a parcel of land adjacent to the Whitten Oval by the State Government, valued at $16 million.
Interesting to compare to the biggest club in the land, runners-up in 2018, the Pies have announced a small profit of $0.1 million from total revenue of $82 million. It is an improvement on the loss of $2.7 million reported in 2017.
Melbourne has recorded a fifth consecutive profit, with an operating profit of $0.5 million from revenue of $49 million. Its statutory profit is closer to $7 million after the sale of the Leighoak gaming venue in July.
Geelong has reported an operating profit of $4 million from revenue of $68 million. This figure is inflated by the recognition of leasehold improvements transferred from the Kardinia Park Stadium Trust to the club valued at $5 million.
The only other publicly available information we have is a Herald-Sun report last month that the Gold Coast Suns were set to report an operating profit of $2 million.
Apparently this has come about from the Suns being forced to sell their home games due to the unavailability of Metricon Stadium for the first half of the season because of the Commonwealth Games.
While that sounds impressive for what remains a struggling club, we probably should retain some scepticism until we know the full value of the AFL annual dividend which I expect to be well above the average dividend.
I will complete the second part when the remainder of the financial reports are in.
[roar_daily_newsletter]
Ilias Mavromatis
Roar Rookie
The club incurred a loss of $987,321 is concerning That’s concerning we get nothing but spin! Spin spin and no accountability the board is either not concerned or woefully ignorant. We extended a coach who delivered nothing and a China exhibition that done nothing Supporters/members want the truth and they want a club that doesn’t accept mediocrity Who is doing the 'creative accounting'??
Mister Football
Roar Guru
There are four or five clubs yet to publish their financial results, so I haven't been able to do the promised follow-up article to this one.
Mac
Guest
It's pretty simple, If the teams that get handed blockbuster timeslots agree to give those up then there will be no need for financial assistance for the clubs that don't get handed those 'gifts'. The Richmond's, Collingwood's and Carlton's of this world have been gifted the best timeslots and exposure which brings money and the status of being a 'so called' big club. They have been gifted these things when they clearly don't deserve them and it becomes a vicious circle where the clubs that don't get them never get a prolonged chance to elevate themselves. Now Cat, for you to continually question the assistance that the Bulldogs get smacks of a deep seated hatred for them... care to elaborate. Were you happy that they won the flag in 2016 or does it burn you up inside?
Mister Football
Roar Guru
News just in that Collingwood has exited the gaming industry, having sold off all of its pokie licenses. While that has happened, Essendon has extended its lease on its pokies venue.
Mister Football
Roar Guru
Doesn't matter, once it hits their bank account, it's operating revenue.
anon
Roar Pro
There's no appetite for AFL in QLD. The AFL has backed the Suns to the hilt, to the tune of several hundred million dollars and football on the Gold Coast has a worse presence than it did prior to the introduction of the Suns. I don't mind the AFL supporting one bludger in QLD but not two.
anon
Roar Pro
The "dividend" isn't handed out equally to each club. It's not a split of revenue. It's welfare. The tin rattlers get a disproportionate amount of it. If it was an equal split of revenue then yes it could be classified as operating revenue. That extra $10 million that a team like the Suns receive is welfare. It's not operating revenue. It's like running a business at an $8 million loss, but claiming you made a $2 million profit because you put $10 million of your own capital in it. Do you think anyone would buy a business like that? Don't be ridiculous.
anon
Roar Pro
The Giants often play that Saturday twilight slot, have been in the top 8 and touted as the next big things. Nationally they probably get an above average rating. In Sydney, I doubt they command great attention. Just look at their attendances. The GWS vs Suns games this season had about 3,000 people in the crowd (AFL fudged the official figure). I remember going back to around 2011 or so, the Swans getting 60k viewers in Sydney for a Saturday night game on Ten. That's on FTA. The extra game argument to justify having second sides in GWS and Suns doesn't stand up to the slightest scrutiny. TV rights are only worth something if you have people watching. Sure western Sydney has a high population, but no-one is watching AFL. Therefore not worth anything. You'd have far higher local ratings with a team in Tasmania, or third team in Perth. Therefore TV rights would be worth even more with third team in Perth or team in Tasmania.
Mister Football
Roar Guru
The $2.5 billion TV deal rightly belongs to the 18 clubs who play across the 23 round season. Pretty bizarre for anyone to suggest otherwise. As just one example, the newest AFL club, the Giants, has average ratings that have consistently been above the AFL average for the last three seasons. But your argument would be that it deserves none of the TV money.
Mister Football
Roar Guru
The AFL "dividend" is received for playing in the AFL, so yes, it forms part of their operating result.
Aligee
Roar Rookie
You must remember the Southport FC wont let the Suns go anywhere, they have millions of $$ of assets and cash and ATM are building 120 room hotel. very similar to a Leagues club style setup.
Paul D
Roar Guru
You mean much the same way a succession of liberal governments claimed "balanced" budgets by flogging off one-off, irreplaceable public assets?
Paul D
Roar Guru
And I have said many times I'd love the AFL to have left one side in QLD and set up a side in Tasmania. The Lions were left insolvent largely due to neglect from the AFL and a desire to see the Lions suffer as penance for winning the flags we did. we got clipped from the pellets everytime the AFL loaded up a scattergun and fired at the Swans over COLA, academies etc. I have written extensively about this and don't accept for the moment that the Lions issues were entirely of their own making. A lot of the reasons why the lions are insolvent stem from the AFL dumping another team into QLD and carving off 10,000 members from the Lions fanbase, for example.
anon
Roar Pro
If it's about generating revenue then the clubs that generate the most should receive the greatest share of the distributions. That's fair. What we have now are a group of clubs that are practically insolvent, have been for 30+ years, contribute little financially, have small supporter bases, yet the AFL distribute more money to these clubs than those that generate the bulk of the revenue. The current system rewards incompetence.
anon
Roar Pro
But the Suns are reporting it as part of their operating profit. As profit generated from their day to day operations. A "dividend" (above and beyond given to financially healthy clubs) handed to the Suns at year end to turn a massive loss into a healthy profit is not part of their operating revenue. The Suns are insolvent, require a massive welfare payment to keep the lights on. Saying you made a healthy $2 million operating profit is deceptive. The intent is to deceive the public because most people don't have a clue about extent of the welfare received by these tin rattler clubs.
Mister Football
Roar Guru
But if the AFL pays the Suns a dividend, whatever the quantum, the Suns must report that as revenue. They can't pretend that the transaction never occurred. That would be deceptive.
anon
Roar Pro
I'm happy for the AFL to subsidise one team in QLD, but not two. QLD doesn't deserve two teams. The Lions are insolvent. The Suns require the AFL to commit a kind of accounting fraud in order for them to appear viable.
anon
Roar Pro
There you go. They haven't operated at a $2 million profit. They've operated at a substantial loss, but the AFL has given them a big enough "dividend" in order to make it look as though they are operating at a healthy profit. They are being deceptive. It's lucky that the AFL doesn't have public shareholders.
Paul D
Roar Guru
Every time you say something like this you reveal the limits of your involvement with the sport. As always, you think AFL is all that there is in terms of football. Your superficial engagement on a surface level blinds you to the deep involvement in grassroots and lower level footy in this state at all age levels, both men and women, that would not have been possible without the engagement the Lions brought to the state. Hush now.
Mister Football
Roar Guru
Arguably, it has helped them survive 8 years of horrible performances. Any club would have suffered a massive drop in attendances and interest after 8 seasons like that.