Club Mgmt. 2015 financials

[Bunk Moreland]

Our accounts have been published for those interested.

http://s.afl.com.au/staticfile/AFL Tenant/Essendon/Club HQ/Annual Report 2015 - Print.pdf

P&L wise, we recorded a loss of $1,336k, which is disappointing.

However, cashflow remained strong which is most important... we made just under $2m before depreciation and amortisation.

Significant items:

- net costs of ASAGA (after insurance etc) were $461k for the year. This is in addition to $1,071k in 2014 and $3,940k in 2015, for a total net cost of $5.5m across the three years. Huge numbers that we've absorbed in the P&L. There'll be further net legal costs in next year's figures (less again I think), plus any fines from WorkSafe.

- on top of this, we incurred an additional $200k in expenses for the top-up players used in the NAB Cup

- other football dept expenses were up $1,610k on last year. This will include Hirdy's payout for the last year of his contract. Usually, spending more on football isn't a bad thing, obviously payouts aren't good however. No details on what the rest of the increase was.

- net revenue from the Windy Hill and Melton social clubs was up $420k on last year

- cash distributions from the AFL were up $377k on last year

- donations down $366k on last year, predictable drop off given how much certain parties pumped in last year, which was never going to be an ongoing thing.

- we kindly donated $270k to the new AFL equalisation fund to help keep our little cousins kicking. North, Saints etc... you're welcome just an Xmas card will do.

- membership revenue up $186k on last year on the back of record membership - another phenomenal effort

- match receipts down $376k on last year, obviously largely as a result of onfield performance

Net assets of the club are $37.3 million. We owe $5m on the Tulla joint and have $848k in the bank, plus access to a further $2.9m in overdraft facility (loan money in the event it's required).

A disappointing year but not unexpected given the woeful performances and exit of Hird. We've taken a hell of a buffeting, but the worst should be behind us now.

Members, sponsors and benefactors sticking fat and staying united behind the Board - when lets face it, the place could have been torn in half - has seen the club through this.

 

[fishardansin]

 

[GUMBLETRON]

So that's, what, a $5m loss without pokies?

 

[bombersfan4000]

So that's, what, a $5m loss without pokies?

It costs money to run those poke venues so who knows what the real profit is.
Interesting fact essendon out of all the Victorian clubs have the highest revenue out side of poke revenue

 

[Ned_Flanders]

Considering the cycle you are in, this is a good result

Membership and Corp could have been a lot worse, so a healthy result all being considered

 

[kelvin_sheedy]

Will be worse next year.

Time to cut some more non performers. If you can't turn a profit from 60k members than you're just no good.

 

[Bunk Moreland]

Will be worse next year.

Time to cut some more non performers. If you can't turn a profit from 60k members than you're just no good.

Very much doubt that. For starters Hirds payout was, on estimates, $800k - $1m, that's a one off.

 

[Doss]

Also, attendances will likely rise next year, barring us dropping off the cliff performance wise again.

 

[Bunk Moreland]

Also, attendances will likely rise next year, barring us dropping off the cliff performance wise again.

Hopefully. The first key is maintaining membership after such a poor year.

 

[Bombermania]

It would be easy to be disappointed with the headline loss but if we consider a few things then this result is a pretty good one

Main positives

-We reduced our current liabilities (need to be paid within 12 months) this is important as it indicates the loss is a revenue issue and for a football club should be easier to resolve, if the loss was due to increasing liabilities, we would face the prospect of needing to make cuts or pull back from project spending or have to tap the members for higher membership fees.

-The revenue was down thanks to receiving no prize money, solution make the finals.

-These financial reports would include the cost of Hirdy's pay out and may also include the course he undertook, these costs wont be in next years numbers.

-Highly unlikely that we will play as badly next season so the attendances should be a bit higher.

-The risk is if membership levels fall off from last year, without doing the sums, I would think that the club would need a similar membership level next year plus make the finals, reduce unnecessary costs then we should return to profitability.

-Adding to this risk, I don't think we play a home game against the Pies next year.

 

[Bunk Moreland]

It would be easy to be disappointed with the headline loss but if we consider a few things then this result is a pretty good one

Main positives

-We reduced our current liabilities (need to be paid within 12 months) this is important as it indicates the loss is a revenue issue and for a football club should be easier to resolve, if the loss was due to increasing liabilities, we would face the prospect of needing to make cuts or pull back from project spending or have to tap the members for higher membership fees.

-The revenue was down thanks to receiving no prize money, solution make the finals.

-These financial reports would include the cost of Hirdy's pay out and may also include the course he undertook, these costs wont be in next years numbers.

-Highly unlikely that we will play as badly next season so the attendances should be a bit higher.

-The risk is if membership levels fall off from last year, without doing the sums, I would think that the club would need a similar membership level next year plus make the finals, reduce unnecessary costs then we should return to profitability.

-Adding to this risk, I don't think we play a home game against the Pies next year.

I'm pretty sure all our Collingwood games are revenue shares, so shouldn't have an impact.

It smooths out having Anzac Day one hear then a late season game which may not draw the next.

 

[Jade]

Will be worse next year.

Time to cut some more non performers. If you can't turn a profit from 60k members than you're just no good.

Seriously doubt that. Club has bee at pains to show all losses NOW.

Would be stunned if we didn't turn a healthy profit or seriously pay down liabilities this time next year.

 

[bombersfan4000]

It would be easy to be disappointed with the headline loss but if we consider a few things then this result is a pretty good one

Main positives

-We reduced our current liabilities (need to be paid within 12 months) this is important as it indicates the loss is a revenue issue and for a football club should be easier to resolve, if the loss was due to increasing liabilities, we would face the prospect of needing to make cuts or pull back from project spending or have to tap the members for higher membership fees.

-The revenue was down thanks to receiving no prize money, solution make the finals.

-These financial reports would include the cost of Hirdy's pay out and may also include the course he undertook, these costs wont be in next years numbers.

-Highly unlikely that we will play as badly next season so the attendances should be a bit higher.

-The risk is if membership levels fall off from last year, without doing the sums, I would think that the club would need a similar membership level next year plus make the finals, reduce unnecessary costs then we should return to profitability.

-Adding to this risk, I don't think we play a home game against the Pies next year.

Its not exactly doom and gloom millions in those expense went to paying out bird and legal fees, but the club is still building and paying off the new HPC.

 

[GUMBLETRON]

I'm pretty sure all our Collingwood games are revenue shares, so shouldn't have an impact.

It smooths out having Anzac Day one hear then a late season game which may not draw the next.

Normally a split gate across both games with the Anzac home team rotating. Next year though it's just the single game, Collingwood at home, but they've generously offered to maintain the arrangement regardless.

 

[Old Campaigner]

Obviously you want to make a profit but as long as the cash flow is sufficient we could potentially have a couple more years like this one without any ill effects.

But as others have said, most of the extra costs relate to things that are not likely to be a factor next year, such as Hird's payout, ongoing legal fees and so on. The reduced membership/gameday numbers shouldn't be a problem next year because I expect that to really jump up once the WADA stuff is over, at worst we get an unfavourable outcome and have to suffer through one more year of poor memberships and match attendances. There would need to be a provision for Worksafe fines too.

All things considered we've pulled through this shit pretty well, if similar had happened to other clubs I think they'd be in the hands of AFL administrators by now.

 

[Doss]

I expect the peak of our bad trot financially to be this year.

I don't know if we'll return to the black next year, but I expect that by 2017, we will have.

 

[Old Campaigner]

I expect the peak of our bad trot financially to be this year.

I don't know if we'll return to the black next year, but I expect that by 2017, we will have.

Unless we have a very large Worksafe fine combined with losing the WADA appeal causing low membership numbers I think we will return to profit next season.
Legal expenses will drop right off, and unless we sack Worsfold we won't have a $1 million+ payout on the books. Given the loss was only $1.3 million, taking away Hird's payout we're almost back to profitability.

The unknown for me is how much of the donations came from Little and how much will they will continue after he gives up his position.

 

[Bunk Moreland]

Normally a split gate across both games with the Anzac home team rotating. Next year though it's just the single game, Collingwood at home, but they've generously offered to maintain the arrangement regardless.

If that's the case then TBH pretty good of them, it'll put a lump in their match receipts as they'll only have 10.5 home games next year vs 11 for everybody else and 11.5 for us.

It'll remain the same for us in 2017 I guess, however improvement in our results could see a return to 2x Coll v Ess fixtures.

 

[blitzer]

If we have some success on field and less problems off field we will easily turn this problem around with our recent membership numbers.

Hell if we get WADA sorted this year - then 2016 i expect our crowds wouldn't fall away so much even if we were crap.

 

[Paul_Barnard]

Also, attendances will likely rise next year, barring us dropping off the cliff performance wise again.

This is a big assumption.
Membership numbers will likely fall next year.
Last year memberships were bought on the premise that we would be improving on 2013's campaign and challenging in the finals.
We are now beginning a 3 year plan with zero expectation to be playing in September.
Furthermore, many members will be disillusioned with how James Hird left the club meaning we could temporarily lose their support as well.