How NRL Clubs Lost A Staggering $42.7 Million

[betcats]

1) How many paying members do they have ? Is it at the top of the range or closer to the bottom?
Souths 2015 , 35000 plus members

2) Are the Roosters home crowds near the top of Sydney clubs? No they are not.

3) Do the Roosters have the highest sponsorship $$ in the NRL ? No they do not

4) do the Roosters admin and run and extensive juniors program that chews up their funds?

5) Do the Roosters spend over their budget .......? must do , to be running at a loss.

6) Do the Roosters have a good team ......sure do , does that automatically mean they are well run? It does mean they spend their losses better than other clubs making losses.

Definitely the first 3 points suggests they are either poorly run or do not have the enough real support .

They do not have the support they should have no doubt, but is that because they are not well run or is it because they are in a tough market? They have been one of the more successful clubs years which alone suggest they are well run. A footy clubs main goal is to win, it is more important than turning a profit.

 

[siv]

No they don't, even after leagues club grant they are showing significant deficits in their end of year profit and loss statement. Take a read of the clubs annual reports, it's pretty clear to see. If the leagues clubs grants wee covering total losses it wouldn't be an issue as long as the leagues clubs had the capacity to keep covering all loss.

So lets see the real profit/loss figures fir the last 3 years and the real asset base today of each FC

Then we can see who really in finacial trouble or just having a hickup

 

[franklin2323]

Exactly, I would much rather our club keep investing in the junior leagues than have them making a profit. Like what is more important to RL? That the panthers turn a profit or that our junior leagues are well funded? Having both would be nice but the reality is given the nature of professional sports in general and specifically the Sydney RL market making a profit is difficult.

Pro sports teams aren't like other businesses whose main goal is to make money, being competitive and winning is usually the main goal, and in some cases for RL clubs spending on the juniors would also be more important than profit.

Again having 16 footy clubs turn a profit would be great but I think it is becoming overrated considering the role leagues clubs play.

You have to work in your means. Panthers NRL side is an arm of the Leagues club which made $17m profit last year. If we didn't do this in the community the members of the club would want answers.

Once this community centre/Academy is built we are set in the meantime this will happen but we still are $10m in the black. So the haters can shove that up their arse

 

[Sydney Knight]

A Souths supporter in their section even made this valid point.

Although Souths can technically say they make a profit with no leagues club support they have zero junior development costs as this is all picked up by Souths Juniors Leagues.

 

[Babyface O'reilly]

1) How many paying members do they have ? Is it at the top of the range or closer to the bottom?
Souths 2015 , 35000 plus members

2) Are the Roosters home crowds near the top of Sydney clubs? No they are not.

3) Do the Roosters have the highest sponsorship $$ in the NRL ? No they do not

4) do the Roosters admin and run and extensive juniors program that chews up their funds?

5) Do the Roosters spend over their budget .......? must do , to be running at a loss.

6) Do the Roosters have a good team ......sure do , does that automatically mean they are well run? It does mean they spend their losses better than other clubs making losses.

Definitely the first 3 points suggests they are either poorly run or do not have the enough real support .

Yeh but are we poorly run?
Do we need to come first in all criteria to not be considered poorly run?
In my life time, we've won
4 premierships
8 minors
experienced grand final week 8 times
never needed additional monies from, NSWRL, ARL or NRL.
No rescue packages
Never broke, never kicked out.

I think we're run pretty well.
Marketing dept' could do better but it doesn't appear to be a priority where with Souths, it is. But you need to as you don't have a leagues club.

 

[Timmah]

"Not running at the same level as the Rabbitohs" doesn't automatically mean you're running poorly.

That said, Roosters have plenty of areas they could improve in.

 

[morley101]

The Easts leagues group have 5 club premises, 3 in the Sydney metro area, 1 in Wollongong and the last one in Woy Woy (central coast). The Roosters now help fund Junior representative teams on the Central Coast as well as the junior RL teams in Woy Woy. The whole purpose is to spread the Roosters brand on the Central Coast and find 1st grade players of the future. .
They have plans to build another club in the South-West of Sydney at Narellan where they already own the land.

Leagues clubs were started with the express purpose to fund RL in their districts. The clubs are non-profit organisations, so
any profits generated are either re-invested back into the club itself (updating or increasing the size of the club premises) or community donations ( including RL).

The Easts leagues club has assets over $80,000,000 and members funds in reserve (bank) $63,000,000 and has borrowings of $11,000,000 down from $19,000,000 in 2014.
The Roosters are recipients of a great business.

Penrith Leagues club group is bigger again...

 

[Perth Red]

A Souths supporter in their section even made this valid point.

Although Souths can technically say they make a profit with no leagues club support they have zero junior development costs as this is all picked up by Souths Juniors Leagues.

And that's the tricky thing when trying to judge viability and sustainability of each NRL operation. Some clubs pay nothing in jnr development some nrl clubs pay nothing but get grants from the leagues club to pay something, some get more $'s from leagues clubs than they spend on jnrs so leagues club is funding the losses (not including jnr expenditure) of the NRL operation, some clubs pay for jnr development with no leagues club support. Its virtually impossible to work out who is financially sustainable and who isn't at the moment. I guess if they keep their doors open next season they are viable!

it would be nice to see the NRL operation at break even (without jnr spending) so leagues club funding could be used purely for community development, that was really their mandate to justify the social cost of these clubs.

In AFL in the West it is the other way around the 2 AFL clubs pay a license fee to the WAFL who use it for jnr development, opposite of NRL where a lot of these clubs are taking money from Jnr development to keep NRL club operations afloat. I suspect that is what the NRL is trying to aim for, a sustainable cost neutral NRL operation allowing leagues club funding to spent in the community. The current model in NSW is antiquated and born out of a different time for the game.

 

[Captain Apollo]

The Easts leagues group have 5 club premises, 3 in the Sydney metro area, 1 in Wollongong and the last one in Woy Woy (central coast). The Roosters now help fund Junior representative teams on the Central Coast as well as the junior RL teams in Woy Woy. The whole purpose is to spread the Roosters brand on the Central Coast and find 1st grade players of the future. .
They have plans to build another club in the South-West of Sydney at Narellan where they already own the land.

Leagues clubs were started with the express purpose to fund RL in their districts. The clubs are non-profit organisations, so
any profits generated are either re-invested back into the club itself (updating or increasing the size of the club premises) or community donations ( including RL).

The Easts leagues club has assets over $80,000,000 and members funds in reserve (bank) $63,000,000 and has borrowings of $11,000,000 down from $19,000,000 in 2014.
The Roosters are recipients of a great business.

Penrith Leagues club group is bigger again...

You can also add in that the Roosters have been looking into building their own "Centre of Excellence" at Waverly, building their own HQ and training facilities on land they own out of their own resources without any request for a Government grant.

Further Easts Leagues Club, even after giving out grants, allowing for depreciation and what not still made an after tax profit of $ 3,319,959.

 

[thorson1987]

They have been trying to build the leagues club out at narellan for years.

Somehow I don't think it will happen.

 

[BODISGOD]

One paragraph doesn't nearly go into the full picture. Clubs like the dogs could operate at a $10mil loss and the leagues club would cover it. Leagues clubs sole purpose was to prop up the football club. That's like saying McDonald's make a loss if you don't include burger sales.

For tax and other reasons business's often under state their profits. Twitter is in the red by over $100mil ever year yet is valued at around $10billion.

Whilst your general point is somewhat true, Twitter is a terrible example. Twitter's value is about expected future profits, not something going on now. They have an engaged userbase and are trying to monitise that. Sports clubs are much more mature than that.

 

[BODISGOD]

In the case of the Raiders though quite a large chunk of those losses are from putting money into the region.

http://www.abc.net.au/news/2016-02-10/canberra-raiders-play-down-$5.4-million-loss-in-2015/7155348

But Mr Furner said the rest of the financial loss came from running grassroots competitions and junior development.

Mr Furner said the Raiders were one of a handful of clubs managing local competitions as well as the first grade and under 20s teams.



"We've spent about $5 million every year on rugby league in this region," he said.

"This year we include all those costs in our accounts and we haven't done that every year, so that is not to run the Raiders, that's to run league in this region, referees, ground hire, insurances, coach education courses.

"In this region we're both the Canberra district rugby league and the Raiders."

Someone has to fund the grassroots spending. Someone has to fund ongoing losses.

That is a solid breakdown of the clubs finances right there. Penrith put a lot of money into a new junior academy with training fields and top notch facilities.

Which would be capital items and wouldn't hit your profit and loss.

 

[BODISGOD]

Not sure why you're quoting EPL either. The big clubs are successful but just like here in Australia - if you're not part of the big top group you're battling insolvency on the reg.

That wouldn't be the case anymore, EPL clubs have money coming out of their ears, hence why lower rung teams are now competing more and more with the big boys.

 

[BODISGOD]

The Easts leagues club has assets over $80,000,000 and members funds in reserve (bank) $63,000,000 and has borrowings of $11,000,000 down from $19,000,000 in 2014.
The Roosters are recipients of a great business.

Penrith Leagues club group is bigger again...

That isn't cash in bank, that's just accumulated profits over the years. I took a look, they have 8 million in the bank. They're going grand with lots of property but don't over egg it.

 

[Cockosh]

1) How many paying members do they have ? Is it at the top of the range or closer to the bottom?
Souths 2015 , 35000 plus members

2) Are the Roosters home crowds near the top of Sydney clubs? No they are not.

3) Do the Roosters have the highest sponsorship $$ in the NRL ? No they do not

4) do the Roosters admin and run and extensive juniors program that chews up their funds?

5) Do the Roosters spend over their budget .......? must do , to be running at a loss.

6) Do the Roosters have a good team ......sure do , does that automatically mean they are well run? It does mean they spend their losses better than other clubs making losses.

Definitely the first 3 points suggests they are either poorly run or do not have the enough real support .

1. In 2015 we had 16508 members. 6th highest of the Sydney teams and 7th overall. We were only 1500 odd behind dogs and saints. Hardly the worst and not bad for a club that cops the most criticism for lack of fans.
2. Yes they are. We had the 3rd highest home average (15661) of Sydney teams behind Souths and dogs. Souths only had a 1000 more than us (16613). 6th highest overall. Again far from the worst.
3. Who knows but I'd guess we'd be up there

So it doesn't suggest they are poorly run or don't have enough support.

 

[siv]

What is more interesting is how did the NRL lose $18 mil

 

[Perth Red]

Ssh grant wants you to focus on the clubs losses not the NRL'S. Classic leak a bad story putting the focus of the media somewhere else prior to releasing your annual report that shows losses. No doubt they will blame it on bailing out clubs, I hope that is $18mill after putting some away in the future fund not before!

 

[BuffaloRules]

Was Smith in any way to blame or just Grant for the NRL loss?

It's only a few months ago that everyone was saying that Smith is a genius.

 

[Perth Red]

Depends on where and how the money has been lost I guess? NRL revenue in 2014-15 was at an all time high so will be interesting to see what the expenditure has been on. Grant made mention off something to do with costs of getting the TV deal done but surely the consultancy group can't have been that much so early on? Remember these financials are only up to June 30th 2015 so won't include any pay out to Smith. Report should be out in next two weeks so let's see what they've done with the games money.

 

[Miller was a legend]

Nrl probably invested in a WA mining venture