Anonymous
Years ago

PAFC runs out of cash, SANFL may take over

http://bit.ly/kGN7E7


Interesting situation really, what will the AFL do? Could it be the end of Port Adelaide in the AFL?

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Moses Guthrie  
Years ago

Just my thoughts - the AFL gave the licence to the SANFL. They can take it off the SANFL and hand it directly to Port Adelaide?

The problem isn't Port and for the Crows' supporters who want to sink the boot in, your club is in strife too. It's the SANFL strangling the two clubs. Time to cut them off and let them stand on their own two feet. Reminds me of the parents who wouldn't let their children grow up, get married and leave home etc. They're too dependent on the board/lodging being paid by the kids. They've grown up, let them go. You're holding them back.

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Moses Guthrie  
Years ago

PS. The problem here isn't that Port is out of cash. Read between the lines and you'll see it's the SANFL that is broke. Crows will be next if we're not careful.

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Jack Toft  
Years ago

Well spotted Moses, the SANFL is in dire straights

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paul  
Years ago

I would say both are out of cash.

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HO  
Years ago

The AFL has signed a deal guaranteeing TV 9 games a week from next year. PAFC has to survive in the AFL, at least in 2012!

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Anonymous  
Years ago

No, that just meabs that they require to have 18 clubs.

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BMF  
Years ago

"The league, which has $27 million of debt and borrowed $4m to underwrite the Power last season, says it has no reserves and line of credit to further bankroll Port."

This is what Moses is talking about.

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The Answer  
Years ago

Or is it credit providers saying "yes, we would extend your credit for other things, but to take on debt of a 3rd party, sorry we aren't willing to do so". Would seem weird that with predicted profits of the SANFL that they cant get any further credit. Unless they maxed out their credit card then got the wife to max out hers as well......

Couldnt see the SANFL being able to create another club to hand the license to in time for next season, so expect an AFL bail out (again).

The majority of power "fans" are to blame for this, not attending games unless their club is winning.

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Ushiro  
Years ago

Not quite correct Moses, the SANFL is not broke. They are carrying debt of $27,000,000, including $4,000,000 it borrowed last year to bail Port Adelaide out. They are not in a position to borrow any more or have their line of credit extended. This debt would be the loans they have for extensions, upgrades, etc to AAMI Stadium and would normally be managed payments back to the banks.

Port Adelaide is not attracting enough sponsors and not enough spectators to games to give them cash flow. You can only run on a weekly loss cycle for so long before it comes unsustainable.

In regards to the SANFL and its nine member clubs, they have been bleeding the Crows and Power dry for the last 13 years by their required "dividend" payments back to the SANFL. The Power have never or hardly ever made these payments as they have seldom made more than a minimal profit. However, the Crows have some years made around a $2,000,000 operating profit, only to see 80% of it paid back to the SANFL.

This and the Stadium hiring deal is the reason both teams are suffering, to the financial advantage of the nine SANFL teams. The WA teams have a clean stadium hire with the WAFL for several years which means that they pay a fixed amount to the WAFL for stadium hire and all profits from advertising and other revenue go to the clubs after daily operating costs.

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tickle  
Years ago

SANFL are bloodsucking leeches, return the licenses to the Crows and Power respectively.

What they are doing is akin to inventing cold fusion and then channeling all of your profits into the coal power section of your business. Scum of the earth.

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paul  
Years ago

I think maintaining a strong SANFL is very important. The AFL has taken over footy in Victoria and it is not a good thing. They are already threatening to cut funding to all areas of the game.

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Anonymous  
Years ago

Is this possibly a strategy by PAFC to force the AFL's hand to take the licence from the SANFL and hand it over to the club?

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Anonymous  
Years ago


Adelaide can't support two teams especially two underachieving teams, we just don't have the numbers.

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KingJames  
Years ago

They should merge and have the name of Adelaide Power Crows :)

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Anonymous  
Years ago

They could most certainly support 2 SA AFL teams.

Think of it this way, having 2 teams means that there will be footy in SA every week.

It also means that it will double the chance of young kids to get drafted by their home teams in the future.

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K.E.T  
Years ago

I think the Crows are fine as it is KJ ;)

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Jack Toft  
Years ago

For regular posters, you may know I have an extremely cynical approach to the AFL in general. I believe it is one of the most biased sports played in this country. Uneven draws, uneven rules, uneven distribution of funding, and an attempt by the AFL to expand the game at all costs and at the same time, maintain a heavy Victorian bias only denigrates the game to an extent that it is the poorer for it IMO.

The SANFL has been hit by poor attendances in the SA League since the introduction of the Crows and Power, however, this shift in attendances has, over the years, not really affected the local clubs as they receive a dividend out of the club's profits and everything has been balancing out.

AFL attendances have plummeted over the last few years for many reasons. From what I understand, the SANFL pay the AFL from the game, then "hire" out AAMI stadium to the Club for matchday, but also look for monies from the gate and from food and drink. What this has meant is that the accountants have had a field day shuffling monies between accounts and the only really winner has been the AFL who have been sucking money from each game with some games running at losses.

The SANFL's decision to keep Port as two clubs has placed strain on that organisation and now they are "one club" this has helped, but was it too late?

The SANFL is probably at it's limit of assets to liabilities ratio and as people have pointed out, it can't keep funding by borrowing against ageing, rundown assets. The WAFL and the two WA teams operate differently than the SA Model, so it may be time to look at how they do it.

So long as SA cash is heading to Victoria to fund expansion of the AFL in NSW and Queensland, the AFL seems happy. Perhaps the AFL needs to consider how it can protect it's cash cow before the grassy paddock of SA Footy turns into a muddy quagmire.

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HO  
Years ago

Interesting comment Paul. The AFL are 'threatening' to cut funding to a body they don't control....

i would too....

From what i can see the AFL are building the best model for sport management in Australia, by removing self interested state groups and corporatizing the sport. There was some noise about this a couple of years back. I think Queensland and NSW are already effectively branch offices of the AFL.

All power to them. (sorry for the pun)

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Anonymous  
Years ago

Completely agree with HO.

Put it into basketball perspective.

Basketball Australia is the peak body. They should be in control of basktball in this country.

But in reality the NBL clubs and State Associations have complete control over Basketball Australia.

Meanwhile the WNBL clubs have to fund their entire competition from their own pockets, even though Basketball Australia gains funding for women's sport and in particular the Opals as Medal chances.

But because the WNBL clubs and Women's basketball has no power or voice, they get ignored.

Junior basketball is a mess with every state completely different. There's no National plan, or program. There's a mess of multiple junior national tournaments run locally and quite poorly in comparison to other sports, even smaller ones.

The best model is for the peak body, run by independant board members and staff to be controlling the future of the sport.

Well done to the AFL. It's time the SANFL understand they're a State body, not a peak body.

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Anonymous  
Years ago

The problem I have is that there is no one overseeing the AFL. It would be a bit like the NBL being in charge of everything basketball related in this country. Sometimes what is in the AFL's best interests isn't in footy's best interest.

There just isn't the supporter base to sustain a Port Adelaide team in the AFL. It was a mistake but now the AFL are wedded to them as they just signed a new five year deal for the TV rights of a league consisting of 18 teams.

Even though the SANFL is probably sick of bailing out the Power they know if the AFL has control of the licence they could easily transfer that licence to say a team in Tasmania or get the Power to relocate.

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bretts the man  
Years ago

Great post Jack Toft .
Other posters say SANFL bleeding clubs dry but sorry guys all our local clubs are working their butts off to stay financial with Pokies, fundraising and few local sponsors keeping them going along with tighter budgets. Not money getting via AFL clubs.
Power have MR Bucky and Mr williams to thank for their current crisis as when losing money badly 3-4 years ago their football dept was in top 3 in expenditure.
Then their 1841 history marketing in last few years was clever wasnt it

Reply #319319 | Report this post


paul  
Years ago

The AFL now officially control AFL Victoria, HO. They have unofficially done so through financial means for many years. I dont think the same path would be a good outcome for SA football.

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Anonymous  
Years ago

While the AFL funds everyone they can do whatever the hell they want.

If the SANFL want to be in control of their own future then they need to survive without living off AFL money. Which they can't.

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HO  
Years ago

jack and BTM, its easy to say that all the SA $ are leaving the state to go to the AFL, but I'd be interested to know how you substantiate it....

The AFL to my knowledge get no game royalties for any regular season games in any state - only finals.

If the SANFL are making all the cash from gameday then that would be the core reason the Crows and Power might not be doing so well....

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Anonymous  
Years ago

I know Rucci likes to blabber on about his poor beloved Port in the paper but I think it's absolutely disgusting to imply the SANFL should scale back to accomodate the Crows & Power.

Putting aside the fact both the Crows & Power blow so much money on support staff (your mind would be blown at the amount of people on the Crows payroll outside of the list) but both of these teams especially the Crows raided and gutted the SANFL to fill out their teams.

They will always owe the SANFL.

The Crows have money coming out of their arse and with one of the largest memberships in the AFL so if they're somehow losing money the bone perhaps could be pointed at the monkeys running the club.

This whole story is about the mis-management of the Power no matter how Rucci and the others living off of the AFL teat try to paint it differently. It's the same reason Rucci calls for Crows/Power reserves teams to be in the SANFL so the AFL can effectively takeover the league. The Port Adelaide expansion into the AFL failed.

Personally I'd like to see the SANFL cut the Power adrift and let them become the AFL's problem. Most of the SANFL clubs are doing quite well thanks to their expansion into pokies (as odious as it is) and would probably be better off seperating themselves from the AFL entirely.

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Jack Toft  
Years ago

HO, my understanding from discussions is that AFL Clubs pay a fee to the AFL, much like a "standing charge" or "period cost", that any organisation charges it sub-branches. This is to cover the corporate function of the AFL. If you work for a large organisation with several branches, whenever a budget is prepared, the overhead costs are usually the first line on a budget. Ask a McDonalds franchisee about it!
Someone please correct me, but from what I understand, the cost to compete in the AFL is around $6M/yr per club and this is what each AFL Licencee is invoiced annually by the AFL. (this could be an old figure, but this is what I have been told)
This is part of the total Club budget, but then there's Club admin costs, player costs etc

The AFL Licence for the Crows is held by the SANFL and this is where the accounting gets interesting. The SANFL are the landlords of AAMI stadium, so they charge the AFL Club a match day fee for the stadium rent. However, they also own the AFL Licence and so in effect any monies they receive from the AFL in stadium rent was theirs to start with. Confused?

At the end of the day, there is a nett cashflow loss from SA.

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Anonymous  
Years ago

anon #333 I guess you're one of those people who believe the SANFL was fine and the Crows should never have joined the AFL/VFL. Probably still one of those that believe AAMI is a world class venue.

Reality check mate, the Crows support staff isn't the biggest in the AFL. Not even close. The Crows fund the SANFL and your SANFL competition despite the money your clubs make through member and gaming.

The SANFL and your SANFL club would not be half the size it is if not for the AFL clubs proping it up with subsidies from AAMI Venue Hire and then again through the ridiculous grant the clubs have to pay back to the SANFL for existing.

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Anonymous  
Years ago

I'm not saying the Crows should never have happened but the SANFL used to be a lot lot bigger than what it is now before they came along. More teams, better talent and far bigger crowds.

There were also a number of players that refused to leave the SANFL to go to the AFL too like Garry McIntosh.

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Anonymous  
Years ago

There was Garry McIntosh. Name a few more?

The reality is that the AFL or VFL back then could become a National league. The SANFL was never ever in that position.

The SANFL has found its market. Its place in the sporting landscape.

What's wrong with the AFL being the #1 Football league and the SANFL being one of many State Leagues?

Time to embrace the National concept and deal with the reality that had to be from a Melbourne base.

Now on to the current situation. The SANFL as owners of both the AFL licences as well as AAMI Stadium is protecting itself. It's using its position to ensure the long term viability of its competition. But it's doing this at the expense of the 2 AFL Clubs, for which it is also responsible for. the Crows until last year could manage this through huge member numbers and huge sponsorship dollars, the likes of which other sports in Australia only dream about. But as the Crows membership base grows older, the sponsorship dollars dry up due to numerous factors, the Crowds drop because of numerous factors (one of which being the sub-par quailty of the SANFL and government backed venue they used) the Crows have evne struggled to manage the financial restraints placed on it by their controlling body and landlords the SANFL.

The AFL through billion dollar TV Deals filters that money down.(note the SANFL wouldn't be in the $100k's for a TV Deal even if the Crows and Power didn't exist.) Down through it's AFL clubs, its State Associations, it's State based clubs, its local clubs, it's development programs such as AusKick. The AFL is even investing in the new Adelaide Oval when neither of the tenants (SANFL or SACA) will be. It doesn't hoard the money in Melbourne. It's spending hundreds of millions trying to grow the sport in NSW and Qld. The AFL income that the AFL generates does benefit your SANFL and your SANFL club through grants, through funding for development programs and development officers and school visits and AusKick. This money and these AFL funded programs ensure that Aussie Rules never again has to deal with any competition from other sporting codeshere in SA, like it did basketball in the late 80s/early 90s. Without AFL funding your SANFL club would have to compete with Soccer, Basketball, Volleyball etc. No longer does your SANFL club have any competition for the best young atheletes this state produces. In fact due to AFL funding even Amateur Leagues can compete with those other sports, as can Country teams spending ridiculous amounts of money on players because of funding, some of which comes from the AFL.

The reality is without the AFL its power and its money football in S.A. would be less then it is today.

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HO  
Years ago

Jack, a quick glance at PAFC 2010 Annual report shows the AFl distributed 7.45 million to PAFC.

There is nothing in the expenses side of the equation that shows anything like a 6 million payment to the AFL.

After COGs of nearly 8 million (i'd doubt that they'd account for a 6m payment to AFL as a COG mainly because it would only leave another 2 mil in real COG's) the only item on the expenses side is 15 mill to run the football operations - seeing as salary cap is 7 mill +, I also cannot see where the 6m sits here.

Is it possible the SANFL pay this fee on behalf of each club?

Seems to me like any net negative cash flow to the two clubs in Adelaide is a result of SANFL deal on license ownership and on AAMI, not on anything the AFL do. The AFL do not hire stadiums on behalf of clubs. Its well documented that they let clubs do their own deals on stadiums and assist where requested.

And, if all clubs in the AFL are paying the 6m, then no one is being disadvantaged in SA.

I do not find the stadium deal confusing, just negative. The PAFC reports show a net result from game day activities which underlines how poor the deal is.

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Jack Toft  
Years ago

HO, I don't know the exact figures, or how it happens, but my understanding was that an ongoing payment is made to the AFL as part of the process. This may be a SANFL cost as part of the licence agreement.

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Rabbit  
Years ago

This all sounds like something BSA would do.

Give clubs $8M in grants. But charge $10M in running costs.

Why would they not just charge $2M.

Or are they all just stupid?

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