Analysis AFC finances - Rich Club, Poor Club?

[xazos79]

That's what the Magarey Room is. Drinks with other fans post-game, a few player interviews... hell I think they even do raffles sometimes.

Unfortunately the prices for drinks there are just as ridiculous as at the ground with, i'm guessing, $0 of it going to the club.

 

[Doedee Bros]

Thought Fages answered Rowes’ pub question really well.
Setting up a pub in the city makes no sense at all when there are so many decent existing options to meet somewhere before the and after the game, the Magarey Room does the job for post match functions for both us and Port.
However, if we can set up our West Lakes facility to be a bit more fan friendly, ie a better set-up in terms of Crowmania, Cafe, Admin integration (you walk into the club and everything is there) and a Carlton / Hawthorn set-up where you can have lunch overlooking the ground, that’d be nice.

what sort of footfall would there be in West Lakes? it would be cheaper because no one goes there

 

[Dc9798]

Forget West Lakes, will never be anything but a training ground and admin centre.

True, the thought of something half decent for the supporter at West Lakes would be nice though.
At least we’ll be able to watch some more training once the AAMI stands are demolished, or am I asking for too much there!


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[jenny61_99]

That's what the Magarey Room is. Drinks with other fans post-game, a few player interviews... hell I think they even do raffles sometimes.

Yeah, it always gets me confused when people complain there's nowhere to go when there is an official post-match with booze and everything AT THE GROUND! Why would a pub away from the ground be better?

 

[Deaneus!]

That BS doesn’t look that strong. Working capital still non-existant. And what are the $6m worth of non-current trade and other payables?

I thought I'd written it was strong, glad i didn't - it's not strong at all, as you mention the working capital ratio* is terrible, for a laugh i should put up Apple's balance sheet.

Great post. Awesome.

That's awfully nice of them to give out that. Is it a requirement of the AFL for the clubs to have this available to the public?

Yes it is - as a not-for-profit association, it's a requirement they provide such to any member of that organisation. Same as the annual report for a listed company. If you DM me your email I will send you a copy (3Mb)

Find it very interesting how steady merch sales are. Variations really only also match variations in cost of product to make (I assume that means we sell a similar amount and the cost of item changes to reflect cost of production).

Would have expected in a GF year those numbers would have spiked.

Ah, that's now they're presented. It's probably not what actually happened. It's actually a very sneaky way of presenting the results from sales, IMHO...

Originally, we had only Gross Sales - Cost Of Sales = Net Profit, then you could divide Net Profit by Gross Sales for the Gross Margin, which on average was 30.4% between 2012-2014.

Since 2015 we've presented a bit different: Now we're Gross Sales - Cost Of Sales = Net Profit plus some other Net Profit we got from Game Day and Online sales.

...which is fine, but it means we can't compare Gross Sales year-on-year anymore, especially since we don't know if the Game Day and Online gross margin % is the same as the 'normal' gross margins (there's no reason it wouldn't be, the product hasn't changed, just the sales channel)

So, if we apply the GM% for any given year against the total Net Profit, we get this instead:



so i'd expect that the full year merch sales for 2017 were probably around $1.8M (the assumption being our merchandise isn't any more expensive to produce for sale than usual)


* working capital ratio a.k.a. quick ratio -> current assets divided by current liabilities, it's a measure of how able a company is to pay the debts which fall in the next twleve months (i.e., the immediate future)

 

[GreyCrow]

Ah, that's now they're presented. It's probably not what actually happened. It's actually a very sneaky way of presenting the results from sales, IMHO...

Originally, we had only Gross Sales - Cost Of Sales = Net Profit, then you could divide Net Profit by Gross Sales for the Gross Margin, which on average was 30.4% between 2012-2014.

Since 2015 we've presented a bit different: Now we're Gross Sales - Cost Of Sales = Net Profit plus some other Net Profit we got from Game Day and Online sales.

...which is fine, but it means we can't compare Gross Sales year-on-year anymore, especially since we don't know if the Game Day and Online gross margin % is the same as the 'normal' gross margins (there's no reason it wouldn't be, the product hasn't changed, just the sales channel)

The BLK effect

 

[AFC3000]

I've never not been able to get into the Magarey Room due to capacity. I think the space is fine, but could perhaps be changed a little as far as layout or content if people aren't happy with it as an option.

I think the problem with a large club owned city venue is that if it's not located between the ground and the trains/where you've parked the car etc. enough people just won't go.

The players wont go back there after a game, we won't bump into Tex getting a schnitzel on a Tuesday night. You'd get the same scheduled appearance from 1 or 2 players like you get in the Magarey Room anyway.

The last time I read the thread on the Port board about what they've got it was full of complaints about how poor it was anyway, so the ones that go on about how great they are for having it probably don't actually go there anyway.

The option of attaching it to a training venue means the location will likely be inconvenient for most people, especially outside of game days, and means we'd lock ourselves into a small but central training ground when the trend is large facilities with multiple ovals at different dimensions, with big swimming pools, gyms, indoor training etc.

A smaller venue that competes all year round with other city venues and has the associated expenses would likely be too small for more than a few hundred supporters to use when everybody wants to go there. Gold Members only on game days? Didn't work well in the new shed at AAMI.

 

[Deaneus!]

The BLK effect

How so?

 

[GreyCrow]

How so?

I think the issues surrounding BLK are deeper than first mentioned , and earlier. There was discussion last year about how the financials looked fudged around merchandise because of uncertainty how BLK was written off.

The change in reporting method without an accompanying explanation should always be a matter of concern. Did the change come with an explanation? Going by your post it seems not

 

[Deaneus!]

I think the issues surrounding BLK are deeper than first mentioned , and earlier. There was discussion last year about how the financials looked fudged around merchandise because of uncertainty how BLK was written off.

The change in reporting method without an accompanying explanation should always be a matter of concern. Did the change come with an explanation? Going by your post it seems not

It's been going on for a couple of years, so I'd have to look at the 14/15 statements i think.

Thanks for the explain RE BLK

 

[Lagi]

I thought I'd written it was strong, glad i didn't - it's not strong at all, as you mention the working capital ratio* is terrible, for a laugh i should put up Apple's balance sheet.

Our working capital along with cash & liquid investments were last robust in 2008, at which time, we had a positive working capital of $6,222,209 (a current ratio of 176%) along with cash & equivalents of $13,528,058.

Since 2008 our cash & equivalents was highest in 2014 at $833,205 and our current ratio has ranged between 24% & 53%. If I analyse 14 other clubs for 2017 (3 clubs still to report) only Collingwood, Hawthorn, Richmond & West Coast have current ratios that are positive or close to, that is close to or a positive working capital. Each of those 4 clubs have been positive for at least the last 4 years. In 2017 these 4 clubs had cash & equivalents that on balance day ranged from $9,881,528 for Richmond up to $63,863,163 for West Coast. The AFL itself on its 2016 figures had cash & equivalents of $86,821,000 and a current ratio of 189% or positive working capital of $69,001,000.

 

[Deaneus!]

Only 4 clubs have positive ratios

Yikes

*must remember to look up North Melbourne*

 

[subaru]

The last time I read the thread on the Port board about what they've got it was full of complaints about how poor it was anyway, so the ones that go on about how great they are for having it probably don't actually go there anyway.

This puffer has been going on about how good the club rooms are and then comes out with this ,.,,,

I don't need to go back to the Club after games .. I go into the rooms after the game at Adelaide Oval ..

So ... it's the best thing since blah blah blah but he doesn't go there after games.


We are a group of 8 that go to games - we sometimes have dinner before ( The British at North Adelaide) or stay for a drink and snack at the Strathmore after depending on the time and day of the game, who drove , where we parked etc

A venue away from Adelaide Oval would be a waste of money.

 

[Lagi]

Only 4 clubs have positive ratios

Yikes

*must remember to look up North Melbourne*

To be precise its just 3 as Collingwood for 2017 was 95% but over ten years they are ok.

Yet to lodge for 2017 but it was 36% in 2016 which represents part of a gradual improvement since 2010 of 8%.

 

[Iron]

I think the issues surrounding BLK are deeper than first mentioned , and earlier. There was discussion last year about how the financials looked fudged around merchandise because of uncertainty how BLK was written off.

The change in reporting method without an accompanying explanation should always be a matter of concern. Did the change come with an explanation? Going by your post it seems not

It could be that they wanted it to fit on one page.

And I'm only half joking.

 

[On The Crouch]

That BS doesn’t look that strong. Working capital still non-existant. And what are the $6m worth of non-current trade and other payables?

Purchase of our licence from the SANFL over 15 years re $6m trade and other payables.

 

[Dc9798]

Apparently, we need a new shed:
http://www.adelaidenow.com.au/sport...n/news-story/d445c065c4566fd151aa1f17591cde9e



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[Geoffa32]

Apparently, we need a new shed:
http://www.adelaidenow.com.au/sport...n/news-story/d445c065c4566fd151aa1f17591cde9e



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Not sure why Tealsters are up in arms over this.

I guess it serves their PR spin of being a "community club".

Good luck to them.

If you think an AFL club is akin to a real community based club you need to get out of the AFL bubble and check out your local club. Before it closes.

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[Mego Red]

Apparently, we need a new shed:
http://www.adelaidenow.com.au/sport...n/news-story/d445c065c4566fd151aa1f17591cde9e



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What does it say?

 

[Tex Danger]

heard a snippet of Cornes talking about this last week.

Saying ho much we need somewhere like the old shed.

HE was then asked, what do Port do? His answer was they use the Magarey Room (the same as the Crows) and they used to use Alberton but it really sucked for players and fans having to drive to a different location and really wouldnt work.

So Port do the same as us yet its a big talking point that we need somewhere to go but not them?

 

[Jack is Back]

Ironically, the Shed was more likely to succeed at West Lakes. With bugger all public transport, it was no picnic sitting in the traffic, waiting to get out of the carparks. My mates and I would go to the Shed for a couple of drinks and wait for the traffic to clear.

At Adelaide Oval most people disperse quickly to the trains, trams and buses. It is also easier to get out of the Adelaide Oval carparks. We usually get to the oval before the gates open to secure a good(ish) seat in the Western Stand and then enjoy a BBQ and drink in the carpark. As a person that used to go to the shed at West Lakes, I can’t think of a good reason to go to a Shed in the CBD regardless of where it was situated.

 

[chazwazza]

heard a snippet of Cornes talking about this last week.

Saying ho much we need somewhere like the old shed.

HE was then asked, what do Port do? His answer was they use the Magarey Room (the same as the Crows) and they used to use Alberton but it really sucked for players and fans having to drive to a different location and really wouldnt work.

So Port do the same as us yet its a big talking point that we need somewhere to go but not them?

Exactly.
Correct me if I’m wrong but I think when The Shed was really popular the Footy Express and terminus wasn’t really set up hence most people were driving which gave supporters more ability to hang around after the games, once they were dependent on a bus they probably left straight after.
This dependence on busses has probably increased at AO and I’d assume even more people are leaving straight after.
If the club really wanted to test this they could hire out part of The Cathedral Hotel for supporters to go to. Sturt does/did this sometimes after AO games for presentations. I don’t think AFL clubs have presentations and I’m pretty sure they’re not open to the public.
This is such a non issue it’s not funny.

 

[chazwazza]

Ironically, the Shed was more likely to succeed at West Lakes. With bugger all public transport, it was no picnic sitting in the traffic, waiting to get out of the carparks. My mates and I would go to the Shed for a couple of drinks and wait for the traffic to clear.

At Adelaide Oval most people disperse quickly to the trains, trams and buses. It is also easier to get out of the Adelaide Oval carparks. We usually get to the oval before the gates open to secure a good(ish) seat in the Western Stand and then enjoy a BBQ and drink in the carpark. As a person that used to go to the shed at West Lakes, I can’t think of a good reason to go to a Shed in the CBD regardless of where it was situated.

Snap

 

[Deaneus!]

So Port do the same as us yet its a big talking point that we need somewhere to go but not them?

Well, we are a bigger, more successful, richer, more attended, higher membership club, so it's not surprising.

 

[AFC3000]

No surprise that a 3.4 million/600 thousand dollar profit for the Crows generates a week of negative articles, while the Power got nothing less than praise all round for managing to scrape together enough coins and 3 game memberships to announce they've got enough profit for a couple of tribunal challenges this year.