Wookie on Hawks reporting sheet it says>The Club is delighted to announce a net profit for the year ended 31 October 2018 of $2,011,363
Then on the next line it says>>The consolidated net profit attributable to the members of the Group for the year ended 31 October 2018 is $4,626,038 (Consolidated 2017: $4,763,638).
So whats the difference between the 2 figures?....
Hawthorn the football club that runs a team in the AFL, owns some pokies up at Waverley and leases out some of the buildings at Waverely made an Operating Profit of $2.011m.
Hawthorn the football club also has liquid short term investments in shares and bonds and unlike the majority of entities, rather than account for them in the balance sheet at the lower of a)cost price or b)market value, records them at market value, so after its operating results it records the movements in investments above or below cost and improvements or decrease movements over that 12 months. Hawthorn's investments in 2018 increased by $333k and that's why it records its Comprehensive Profit of $2.344m.
Hawthorn unlike what
dave10 said, records depreciation and amortisation and other non cash items as part of normal operating results just like any normal business does, because depreciation and amortisation is a normal business/accounting expense.
The Hawthorn Football Club consolidated group includes the football club and non current investments in Caroline Springs pokie venue (72% ownership I think) and Box Hill Hawks Football Club and the Hawthorn FC Foundation.
That consolidated group made an operating profit of $4.727m. However the group has minority interests in one of the group entities which have nothing to do with Hawthorn. Their share of the $4.727 is $101k and Hawthorn's share is $4.626m
When you then add the movements in investments of $333k mentioned above, the consolidated group Comprehensive Profit is $5.060m - which is what
The_Wookie recorded in his footy industry tweet. The Hawks share of that is $4.959m and the outside minority interest is $0.101m.
The whole - what is true net operating profit of an AFL football club has become a bit of a farce since the mid 2000's when clubs started building major training facilities that cost between $10m and $30m and they had to write off those buildings over 20-40 years and an annual hit to the bottom line of depreciation of between $500k and $1m suddenly appeared.
The clubs then started spinning the results to the public removing this normal business expense from their normal operating results for PR spin purposes when they release it to their members. When depreciation is between $1m and $2m because clubs are now buying a lot of software and hi-tech equipment that they write off over 2 or 3 years as well have large building depreciation, removing that from "operating results" to look better. Hawthorn don't do this. I know Adelaide do. Port didn't but because the Adelaide media is too stupid to understand this, they in 2017 reported pre depreciation operating result so that Adelaide and Port results in the media were reported more apples vs apples comparison.
When Geelong had to destroy a stand and write that off from its books, it was reasonable that the $1.8m depreciation and write off of that stand was recorded below the line as an abnormal item and not part of normal operating activities/profit and loss, as it was a one off.
Large government grants to build these new facilities tend to be removed from normal operating profits, but those under $1m tend to be reported in normal operating profits.
Add to that that some clubs have over the last 10-15 years started to make significant large investments in separate legal entities, to drive new revenue, that they have now by law, had to produce consolidated accounts for the group results, that can add confusion to the average punter.
The health of any club can really be seen in the Cash Flow statement where you have 3 components and you look at the football club result for;
1. Net Cash from Operating Activities - ie non cash items eliminated but timing issues can affect it
2. Net Cash from Investing Activities - ie cash from buying and selling - land and buildings, property plant and equipment, and buying and selling other investments like shares and bonds. government grants and large donations to build those training facilities sits here.
3. Net Cash from Financing Activities - ie cash in from taking out loans and borrowing monies, cash out from paying off loans and borrowings plus cash out re those borrowing expenses