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SWANSBEST
6th August 2003, 08:07 AM
Lions cash in on success
By Greg Denham
August 06, 2003
BRISBANE's off-field profile has emerged so quickly this year that the club is fast becoming a financial powerhouse of the competition.


From a club that 12 months ago appeared to be in need of special AFL assistance, in November the Lions will offer their senior players the added incentive of being paid $4million of their 2004 wages up front.

As late as May last year, four months before Brisbane won consecutive premierships, the AFL commission was concerned about their viability.

The commission was aware of a major cash-flow problem looming for last October.

But under the management of chief executive Michael Bowers in the past 16 months, and after successive premierships, Brisbane have surged ahead following an operating loss of $850,000 in 2001.

AFL sources revealed yesterday that last year's profit of $1.245m was produced despite a predicted annual loss in 2002 of $2m by the club's previous administration.

Part of the turnaround involved the Lions restructuring a 20-year lease agreement at the Gabba and the sale of a one-off catering deal at the ground for almost $1.6m.

And with a healthy first football-related profit forecast for this season of a conservative $500,000, the Lions are competing favourably with Victorian heavyweights Collingwood and Essendon and challenging West Coast as the most profitable club in the league.

"Originally our model in Queensland was to make an investment in footy because we've been regarded as ordinary performers for a number of years," Bowers said.

"We made a big investment in Leigh Matthews and his structure in the hope that would convert to better on-field performance, which would generate more revenue.

"You are not going to save your way to success."

Brisbane, who will earn $250,000 from bank interest this year, next year could become the financial benchmark of the competition after five years ago being ranked 11th by the AFL based on profitability and cash flow.

Brisbane initially feared they would lose at least one required senior player this year due to salary-cap pressure, but their offer of pre-paying players is a list management technique that may be enough to retain their squad.

"Having up to $4 million in the bank opens up huge options for us," Bowers said. "For selected players to get cash up front helps us to bridge a gap between an offer we make and where the player might be. It's a time and value equation that you can work on."

The Lions are in the process of re-signing a dozen required players who come off contract this season, headed by Jason Akermanis, Nigel Lappin, Luke Power, Chris Johnson and Mal Michael.

In a year where additional competition is being felt in Sydney from rugby union's World Cup, the Lions have increased revenue from gate receipts and membership by 28 per cent, which equates to an additional $2m in revenue.

Attendances at the 'Gabba are up 4000 on last year's average of almost 28,000.

Bowers said Brisbane have planned and prepared well to combat an invasion by rugby union in Queensland.

"Before the World Cup actually starts up, we're going to try to get as many commitments in for the Gabba around finals time when people actually get excited by us," he said.

Brisbane's off-field improvement has been so significant that the club is in the process of a feasibility study into buying a gaming venture situated away from their headquarters at the Gabba.

After lifting turnover to more than $25m, the Lions have programmed the next three years as a period of consolidation and investment.

"We want people to come and be entertained, and not just because we happen to be winning," Bowers said.



http://www.theaustralian.news.com.au/common/story_page/0,5744,6873308%255E23211,00.html

bricon
6th August 2003, 12:30 PM
While Brisbane deserve congratulations for the stunning turnaround in their cash flow/operating position and the anecdotal evidence that their current financial position is improving daily; it must be stressed that the news releases about Brisbane?s latest financial results are a little misleading.


The club announced its latest profit of $1.24 million but it included an extraordinary item of $1.6 million for the one-off sale of the catering rights to the Gabba. In other words the club lost around $360,000 on its normal operations. This is still a miraculous turnaround, as the club had previously predicted a loss of $2 million for the year. But we shouldn't get too carried away with the headline profit announcement of $1.24 million.

That $1.6 million catering rights deal will not be available to the Lions again, they are predicting a profit of $500,000 for the current year - a credible (but not outstanding) result. I'm sure that the Swans can learn something from the Lions' financial turnaround but our situation will be quite different from that of the Lions.