Club Mgmt. 2016 Essendon Financials Statements

[Bombermania]

Just another question. What are people's thoughts on how the opposition clubs view the compensation payment with regard to the salary cap?

In essence werent we able to retain most of our good players by paying outside the salary cap?

Doesn't this go against the spirit of having a salary cap?

Considering what the compensation is for, I suspect most clubs would see it as punishment to the EFC rather than some kind of salary cap benefit, its not like we have gone above the salary cap to recruit these players, their actual match payments will still be within the cap, also the other clubs wouldn't have an issue with it as the compo isn't coming out of their pockets, so clubs like Port will be like, yep EFC you pay.

 

[Paul_Barnard]

Not worried in the slightest - Paul Little carries 9.5mill in his glove box....
IT DOES NOT GET WORSE THAN 2016..
Wooden spoon, poor commercial fixture, poor attendances, compo claims, a dozen extra playing salaries - shocked it's not more really.
Sponsorship wise, the caliber of investors we attract are far superior to 90% of the other clubs, plus our cash flow will only increase over the coming years as we rebound, meaning it is a very manageable figure..
Onward and upwards guys, dont stress.

 

[Bombermania]

Already has 8,218 members two weeks before the automatic renewals.

Might give 60k a shake this season.

 

[JayJ20]

Did you read the quotes from XC in the article that DonsRule linked and quoted? Talking about the changes they've made, when they expect the debt to peak, and how manageable it is with our cashflow. It doesn't sound like they have their heads in the sand about it. There's also a link to the annual report if you don't want to take his word for it.

I meant things will get much worse if we don't see success from the current rebuild. Fans have lingered for the past decade, but the impatience is becoming bigger after the saga. Firmly heading down Carlton's way to irrelevance if onfield success doesn't come soon

 

[Lore]

I meant things will get much worse if we don't see success from the current rebuild. Fans have lingered for the past decade, but the impatience is becoming bigger after the saga. Firmly heading down Carlton's way to irrelevance if onfield success doesn't come soon

I don't think our business model is as reliant on membership and ticket sales as (for example) Richmond are. Hefty sponsorship deals with sponsors and stadia certainly help, among other things. But yes, success would help to pay down debt more quickly. No doubt about that.

 

[Bombermania]

I meant things will get much worse if we don't see success from the current rebuild. Fans have lingered for the past decade, but the impatience is becoming bigger after the saga. Firmly heading down Carlton's way to irrelevance if onfield success doesn't come soon

There is that risk, if we found after a decade of Parish, Zac, Hep on top of the last 16 years without success we could find ourselves with membership levels closer to 40k than 60k, considering membership fees are quite high for a team that isn't winning, there could be problems, sure there will be sponsors but they will naturally be attracted to the successful clubs.

We better start playing finals footy.

 

[Charlie Payne]

Not worried in the slightest - Paul Little carries 9.5mill in his glove box....
IT DOES NOT GET WORSE THAN 2016..
Wooden spoon, poor commercial fixture, poor attendances, compo claims, a dozen extra playing salaries - shocked it's not more really.
Sponsorship wise, the caliber of investors we attract are far superior to 90% of the other clubs, plus our cash flow will only increase over the coming years as we rebound, meaning it is a very manageable figure..
Onward and upwards guys, dont stress.

Totally agree. People have ignored the above, plus $3m in the Bank, $60m odd in cash flow, 57000 odd members, $30m in Assets (I hear they are using metal detectors to find the Boer War Bonds buried in a box at Windy Hill somewhere) plus the Little's, the Schiavello's and other seriously rich dudes who follow us.

Compared to Norf, Melbourne, Bulldogs etc., who only survive propped up by the AFL, not in the slightest bit worried.

 

[Bombermania]

One extra positive, at least our sportswear sponsor hasn't folded

 

[Old Campaigner]

We would just carry the debt forward, just as we did with the Solar Centre. No reason to go to the AFL at all. It doesn't have to be paid back in 12 months.

Nope. Unless the creditors agree to have it restructured (there is no guarantee of this btw) we have to pay all of it off by this time next year. That means that on top of our usual operating expenses we need to come up with close to $11 million in cash.

They say the debt levels will peak next year which I assume means we'll be taking on more long term debt to pay off the current liabilities, but we only have a few million more that we're allowed to borrow.

Add the cash reserves we have now and several million in additional revenue from memberships/ticket sales etc and we'll come close to paying it off but it will be a close run thing and it wouldn't surprise me if the AFL has to bail us out (barring the Bank of Little opening it's vaults for us)

 

[ezard15]

They must have forgotten to factor in the $55 I paid to guarantee myself a grand final ticket if we make it next year

 

[frenchfri12]

is any of this particularly relevant to anything? we're one of the biggest clubs in the leauge, afl needs us alive, 3/4 of the teams here are broke anyway. how would having a 10 million dollar profit be any different?

 

[Old Campaigner]

is any of this particularly relevant to anything? we're one of the biggest clubs in the leauge, afl needs us alive, 3/4 of the teams here are broke anyway. how would having a 10 million dollar profit be any different?

The profit isn't the problem, it's the amount of cash we have vs the amount of debt there is to pay off

 

[Whispering_Jack]

Nope. Unless the creditors agree to have it restructured (there is no guarantee of this btw) we have to pay all of it off by this time next year. That means that on top of our usual operating expenses we need to come up with close to $11 million in cash.

They say the debt levels will peak next year which I assume means we'll be taking on more long term debt to pay off the current liabilities, but we only have a few million more that we're allowed to borrow.

Add the cash reserves we have now and several million in additional revenue from memberships/ticket sales etc and we'll come close to paying it off but it will be a close run thing and it wouldn't surprise me if the AFL has to bail us out (barring the Bank of Little opening it's vaults for us)

What?? Our current liabilities include $4.5m of provisions, presumably for compo... that's basically the only difference in current liabilities between this year and last. We have $2.2m more in the bank than last year (current asset) and have and additional $4m we can draw down on which would become a non-current liability for when we have to pay that compo in the next 12 months. I don't think you've read in depth... yes the current liabilities have gone up significantly, but not via short term finance.

 

[boncer34]

Nope. Unless the creditors agree to have it restructured (there is no guarantee of this btw) we have to pay all of it off by this time next year. That means that on top of our usual operating expenses we need to come up with close to $11 million in cash.

They say the debt levels will peak next year which I assume means we'll be taking on more long term debt to pay off the current liabilities, but we only have a few million more that we're allowed to borrow.

Add the cash reserves we have now and several million in additional revenue from memberships/ticket sales etc and we'll come close to paying it off but it will be a close run thing and it wouldn't surprise me if the AFL has to bail us out (barring the Bank of Little opening it's vaults for us)

So we had no current liabilities this time last year?

 

[Whispering_Jack]

So we had no current liabilities this time last year?

As above, we had pretty much exactly the same amount except the provisions for the compo which they've deliberately provided for this year so it's basically finalised for the future.

 

[boncer34]

As above, we had pretty much exactly the same amount except the provisions for the compo which they've deliberately provided for this year so it's basically finalised for the future.

Well yeah I knew that. I was trying to belt him over the head with a little sarcasm followed by facts.

* you kill joy.

 

[Whispering_Jack]

Well yeah I knew that. I was trying to belt him over the head with a little sarcasm followed by facts.

**** you kill joy.

 

[Bombermania]

The profit isn't the problem, it's the amount of cash we have vs the amount of debt there is to pay off

Absolutely, its cash flow that is important, this is why a company can appear to make a profit yet fail because it didn't have ample incoming revenue to cover the due outgoing debts (liabilities)

In our case I'm not concerned as we know what most of the liabilities are and we know the headwinds we have had should soon subside.

 

[frenchfri12]

Well we made $2 million in 2012, the last year we were unaffected by anything, I don't think we have much of an issue making money.

 

[Jobe is King]

Make money, money, make money, money, money.

 

[Godzke]

The line of credit is guaranteed by the AFL and will be restructured accordingly. Banks look for mitigants to poor performance and verified forecasts. I'm sure the club will won't have any issues satisfying both criteria.

On SM-G920I using BigFooty.com mobile app

 

[Capt Hindsight]

Lucky the AFL is taking over Etihad so the 2017 season should hopefully see better returns from matches played there, even though we had a better deal than North Melbourne, etc. Break even values for Essendon were crowds in the low 30 thousand mark at Etihad (happy to be corrected on this just what i have heard) so that's why gate receipts were down so much as for those record low crowd games in 2016 we would have paid Etihad management just to play there.

So a better stadium deal and better team success with all the players coming back should see a big turn around in gate receipts.

 

[ezard15]

How much has the AFL and other clubs forked out for GWS and the Gold Coast? Surely way in excess of 10 mill? (And Surely if worst came to worst it would be in the AFL's interest to help bail us out?)