North on the Brink of financial disaster - The Age

[hcd199]

Re: North on the Brink

Would be nice to see more balanced and informed reporting from papers but that's probably a pipe dream.

Only probably? I admire your optimism.

This is clearly a case, as many have stated, of poor journalism - yes, our financial situation is hardly enviable, but nor does it require "on the brink" articles.

 

[fondest tozzy]

Re: North on the Brink

hahaha $2749? how do they pay all their employees?

i bet they are regretting that huge afl offer to move to gc now. Yeah moving to tassie looks a good option. they can keep their vic based fans still whilst being a tassie club.

 

[Gen Y]

Re: North on the Brink

http://www.kangaroos.com.au/latestnews/newsarticle/tabid/4912/newsid/107956/default.aspx

The Age article is pretty disgraceful really.

 

[Blues_Man]

Re: North on the Brink

The league will bail them out..

Well i for one hope they do ..other clubs have taken advantage of AFL loans ..mine included.. i would much rather have North in the competition than some Gold Coast or GWS franchise any day of the week .

It's time the North supporters got off their collective arses and helped out their club ...starting at the wealthy down.

I would hate to see the Roos go the way of Fitzroy

 

[Gen Y]

Re: North on the Brink

hahaha $2749? how do they pay all their employees?

i bet they are regretting that huge afl offer to move to gc now. Yeah moving to tassie looks a good option. they can keep their vic based fans still whilst being a tassie club.

within 10 days of that there was over $1M in the account.
It would be IRRESPONSIBLE for the club to sit on cash in their bank account while accumulating interest on a debt, so of course there are going to be points where there is not much in the bank. Just like with every other club.

As for the equalization fund from the AFL. Yes, North Melbourne receives 1.4M at the moment. It has been worked out that this is the amount North Melbourne misses out on by not getting a fair draw/good timeslots. North would survive just as well without it if they received a similar draw to what Collingwood gets.

 

[Memories]

Re: North on the Brink

North would survive just as well without it if they received a similar draw to what Collingwood gets.

Um "Survive just as well" as you currently are? That's not really a good thing.

 

[theyellowsash]

Re: North on the Brink

This really is the worst attitude. The fun in footy is the footy. If you have to play local teams to get the fun, you're less of a footy fan and more of tribalistic rivalry fan or something. It's insular thinking that people always like to characterise Sydney with. It's not 1950 any more.

The old VFL is dead. Move on. If playing local teams is so important, go follow the existing VFL. It's nothing but local teams!

i really enjoyed playing interstate teams last year

 

[AngelEyes]

Re: North on the Brink

Financial reports are a snapshot at a point in time, borrowings increased significantly but creditors dropped even more significantly.

The overall debt position reduced. It doesn't matter if you owe money to a bank or to several large creditors, you have to pay your debt as it falls due and it is often just a timing or cash flow issues.

As long as you are not stuck in a cycle of losing money on trading and have to convert that into debt, which isn't the case for us because we haven't made an operating loss for some time now and have over the years reduced debt overall.

The club has been focused on putting more money into the football department so we are competitive with all the AFL sides on-field. We have increased annual football department spending by $3-4 million, if things were dire, we could cut back spending and put that into debt repayment.

But things are not dire, even during the global financial woes hitting the same time as our rebuild phase we haven't had any financial issues whatsoever.



The assets do have real value, which is why they need to be shown on the accounts. The facilities itself has real value, other sporting bodies that use our facilities also pay to utilise the facilities. They can't exactly be sold to repay debt, which is why they are not shown as a current asset, an asset which can easily be turned into cash.

On the flip side, our profit figure includes the amortisation of the facility and also the depreciation of other assets, these reduce our net profit figure but are paper transactions, there is no cash outflow.

Financials for sporting clubs can be extremely misleading as to what is the actual day-to-day status of the sporting club.



We have a lifetime lease on the land, the land is effectively ours as long as we exist, we would lose the lease at the point where we went arse over ****.

The council itself has a unique perspective of the ownership, ie, according to the law, things like cleanup of the land due to industrial waste was responsibility of the council but they felt it was our obligation to do so, in most ways the council believes we own the land and let us do to it what we think is appropriate once we get past all the usual resident whining.

I think eventually the land at some point will end up in the hands of the club, lifetime leases are an obnoxious legal instrument and cause no ends of headaches, I think eventually in the future the government and club will sit down and come to an arrangement to transfer ownership. Will probably be when we have more money and there is a Sell, Sell, Sell Liberal government in position.



On face value it is a concern, and it is the reason why the auditor's statement is as it is. Don't get me wrong, it is not a desirable position but it is one that can be rectified in a short period of time.

For a service based industry they usually do not have a high amount of assets, especially a non-profit service based industry like a sports club.

It has become recent trend to diversify largely because the operation of the business itself is not consistent, there are huge peaks and significant lows based on the performance of the sports club.

Most of the debt we have is either trade debt, something that will always be around no matter how much money you have or it is largely baggage remaining from the previous administration.

I think when the club sits down to address the old debt then it will be repaid in a timely manner but you have to first make sure the operation of the business is on solid ground. Back in 2007 the business was on shakey grounds. It is in a much stronger position now, we have a new naming rights sponsor, we will likely play a handful of games somewhere to generate more short-term revenue and the new broadcasting agreement kicks in next year which should also see some minor net benefit to clubs.

Now that the business is strong and stable the new gains came be directed towards the repayment of the debt and once that is done invest in the future.



I think the overdraft facility as it is will be sufficient, it is only an overdraft facility that is $201,268 at the time of the report.

The commercial bill we have has $250k more that can be put on it, if needed, but I do not think it will be necessary.

As JB said, a few days after the annual report there was over a million dollars in the bank account, clubs cash accounts fluctuate wildly as money comes in and payments fall due.

It is the overall performance which should be the focus, we wont be having any more facility building in the near future which will distort the accounts.

With all due respect, you are obviously not well trained in accounting. Your comment where you attempt to define a "Current Asset" shows this. Obviously the North Melbourne adhere to accounting standards and the auditor would assess this additionally but your comments don't make sense with all due respect.

Most of what you said is the same old, same old, we can fix this, blame the old admin etc. The reality is that North is on the brink of financial ruin and Brayshaw hasn't saved the club like he promised. How long before Brayshaw gets the white knights etc? The reality is that North fans continue to make excuses rather than look at the facts that the AUDITED financial statements paint a very grim picture for their future.

 

[KillaKanga]

Re: North on the Brink

I have $23.76 in my bank today. Based on the above logic I'm going to be sleeping in my car tomorrow.

However I just paid mortgage, phone, internet, groceries, car payment, petrol, electricity and insurance x2 in the last 4 days. (It happens like that sometimes!!)

Also, I get paid monthly so tomorrow will be getting $4200 put into my account.

It doesn't mean I'm poor today or rich tomorrow. Cash flow is always in a state of flux.

North needs to work on upping the membership and attendence levels and eating away at the debt.

Not panic stations just yet!!

 

[The Falcon Strike]

Re: North on the Brink

No, you are wrong. This land has been left to rot for over a century because council never puts money into anything that isn't run down.

It was saturated with industrial waste that ran off the old industrial sites, they are not upkeeping their responsibilities as land owners, they should let it go to those that do.

You said lifetime leases are an obnoxious instrument - or something along those lines. That's just a pure fabrication.

And land owned by the council is still an asset for the ratepayers, over say a commercial enterprise.

There's a reason they allow an outift like North to have it - because they can then provide a benefit to the community. That's going to be a different stroy if it was private enterprise. You have a lifetime lease, i'd assume but may be wrong, that the lease payment is negligible. As such, it wouldn't be unrealistic to expect North to have to foot the bill.

It's no different to an estate being left to the kids, though with the wife having a lifetime tenancy. If the garden is looking scrappy - it's up to the wife to fix it.

 

[vjknight]

Re: North on the Brink

Not panic stations just yet!!

and that is the final point. not yet, but very much regretably only a matter of time. and at that point, the offer put to you is likely to be far less generous than anything the AFL have put previously, if at all.

north need a contingency plan for best case escape
eg. put the feelers out there and see what deal is possible IF THEY NEEDED TO DO SOMETHING BEFORE the inevitable hits. get the best option and take it to the members - if they reject, then fine, reject it and good luck. but dont dare come crying afterwards.

 

[Harry Manback]

Re: North on the Brink

The only real difference is that Stynes has been shaking the tins and has a lot of emotional support behind him because of his condition.

Really??

Debt Demolition was initiated on August 5, 2008.

Over $2 million was raised on the first night.

Stynes didn't announce he was suffering from cancer until the July 2, 2009.


Despite your pathetic attempts to try and cheapen what he has acheived, the fact is Stynes was uniting the club and getting things done before anyone was aware of his condition.

It depends, i think it can happen if you have a club based in Geelong, Ballarat, Bendigo, Casey, (somewhere else further north) and you have clubs like Carlton, Collingwood, Essendon, Richmond and possibly Hawthorn as the Melbourne based clubs.

The problem is the Demons, they wont have the market share in Melbourne to survive against the other clubs and their dependency on the MCC wont make it easy to move their base somewhere else.

Ummm.... Melbourne have already established ties in Casey.

 

[KillaKanga]

Re: North on the Brink

and that is the final point. not yet, but very much regretably only a matter of time. and at that point, the offer put to you is likely to be far less generous than anything the AFL have put previously, if at all.

north need a contingency plan for best case escape
eg. put the feelers out there and see what deal is possible IF THEY NEEDED TO DO SOMETHING BEFORE the inevitable hits. get the best option and take it to the members - if they reject, then fine, reject it and good luck. but dont dare come crying afterwards.

vjknight,

I did use 'yet' on purpose. North aren't in the strongest state and if we don't pull our fingers out and start eliminating debt soon we are in a dire position.

I do believe that the situation is salvagible though. Or at worst a relocation to Ballarat or Tassie??

Some smart business acumen and success on the field would go a long way to helping.

 

[oak79]

Re: North on the Brink

Posted in another thread, but more appropriate here:

I wish someone would have the guts to relocated Kangas to Tasi - this whole situation is just being dragged on. Its not good for the game, the AFL, or even kangaroos supporters. Victoria is satuarated for a national league - Kangas could become a powerhouse elsewhere.

9 home games in Tas
2 home games in Vic
7 away games in Vic
1 away game in each of SA, WA, NSW & QLD

Once you add in 'Away' games in Vic, Vic members would get to see there club almost as much Non-Vic clubs - could easily have a guaranteed 9-game Vic membership (2 home/7 away).

Stop fighting a dieing market, and embrace one that you can monopolise.

I'm sure the AFL would probably wipe out your debt since you were moving, and you'd basically have the whole state to yourself for sponsorship (minus a little slice of the cake if the Hawkes stick around) -

To complete the picture, maybe 2-3 home games for Hawkes to make a total 11-12 Tasi games. Hawkes could also play 'away' once against Kangas to give them a 3-4 game presence in Tas. Anymore than that would take away from the Kangas being the 'Tasmanian Kangaroos', and subsequent market

 

[Ry009]

Re: North on the Brink

http://www.kangaroos.com.au/news/blogarticle/tabid/9795/newsid/107970/default.aspx

 

[Tas]

Re: North on the Brink

Below the belt, Tas. Normally you write well, but you can give that blue and white middle finger to yourself on this one!

No, I am being sincere. If JB had a terminal illness and his focus was to save the footy club it would inspire a lot more people to the cause.

That is just a fact of life, the Stynes tragedy invokes the spirit of non-supporters, imagine the impact it has on supporters.

 

[Zahki]

Re: North on the Brink

North would survive just as well without it if they received a similar draw to what Collingwood gets.

This isn't true at all, I wish North supporters would quit parroting it.

 

[Tas]

Re: North on the Brink

With all due respect, you are obviously not well trained in accounting. Your comment where you attempt to define a "Current Asset" shows this. Obviously the North Melbourne adhere to accounting standards and the auditor would assess this additionally but your comments don't make sense with all due respect.

Most of what you said is the same old, same old, we can fix this, blame the old admin etc. The reality is that North is on the brink of financial ruin and Brayshaw hasn't saved the club like he promised. How long before Brayshaw gets the white knights etc? The reality is that North fans continue to make excuses rather than look at the facts that the AUDITED financial statements paint a very grim picture for their future.

lol I am an accountant and I have worked for the largest accountancy firm in the world for many years, I try to keep things simple for people on forums because most people do not have the basic understanding of accountancy, like the moron who wrote the article about the club.

I have clearly explained that as a business things have improved dramatically over the last three years, there are some timing issues some have focused all their attention on.

There are a few things the club needs to work on but they are not critical to the club being able to continue operating.

That is as simple as I can keep it for people too simple to understand a more in-depth analysis of the various issues.

 

[Tas]

Re: North on the Brink

This isn't true at all, I wish North supporters would quit parroting it.

A fairer draw with increased FTA exposure would increase revenue from sponsorship and coperate sources which are a major source of revenue. Even if the gate receipts increased by only a small portion it would still make a significant improvement to the club if we could sell the club to corporations knowing in advance we would not get screwed in terms of scheduling.

Do you think Emirates gives a shit about Collingwood? They want TV time.

 

[RandB]

Re: North on the Brink

That is just a fact of life, the Stynes tragedy invokes the spirit of non-supporters, imagine the impact it has on supporters.

Tas, be that as it may, it doesn't change the fact that Melbourne would still have become debt free irrespective of Jimmy's condition. It also has nothing to do with the operational advances Schwab and Stynes have made through the RedandBluePrint in the last 3 yrs which offer Melbourne supporters a genuine future. Surely you of all North posters can fathom this.

 

[Zahki]

Re: North on the Brink

Yeah except for the fact that it's not Collingwoods draw that gets so many to their games it's the fact that we're a club with 50,000+ supporters and North don't even have 20k at the moment. A North Melbourne ANZAC day would barely draw 50k, so it's a complete fallacy to say just by swapping our respective fixtures North would have amazing exposure because the fact is nobody tunes in because it's a North game, not because of the day or timeslot it happens to be in.

 

[sherb]

Re: North on the Brink

Posted in another thread, but more appropriate here:

I wish someone would have the guts to relocated Kangas to Tasi - this whole situation is just being dragged on. Its not good for the game, the AFL, or even kangaroos supporters. Victoria is satuarated for a national league - Kangas could become a powerhouse elsewhere.

9 home games in Tas
2 home games in Vic
7 away games in Vic
1 away game in each of SA, WA, NSW & QLD

Once you add in 'Away' games in Vic, Vic members would get to see there club almost as much Non-Vic clubs - could easily have a guaranteed 9-game Vic membership (2 home/7 away).

Stop fighting a dieing market, and embrace one that you can monopolise.

I'm sure the AFL would probably wipe out your debt since you were moving, and you'd basically have the whole state to yourself for sponsorship (minus a little slice of the cake if the Hawkes stick around) -

To complete the picture, maybe 2-3 home games for Hawkes to make a total 11-12 Tasi games. Hawkes could also play 'away' once against Kangas to give them a 3-4 game presence in Tas. Anymore than that would take away from the Kangas being the 'Tasmanian Kangaroos', and subsequent market

Most of the Tasmanian population already support an AFL side.

I doubt if they would be the slightest bit interested in supporting a club which has always been "opposition" to them.

Relocating a club to a location where the majority already supports an AFL side is a complete waste of time in my view.

 

[Papa G]

Re: North on the Brink

Most of the Tasmanian population already support an AFL side.

I doubt if they would be the slightest bit interested in supporting a club which has always been "opposition" to them.

Relocating a club to a location where the majority already supports an AFL side is a complete waste of time in my view.

Kinda works for Hawthorn though.

 

[BullDurham]

Re: North on the Brink

Let's put this in some sort of perspective eh.

Q: Name one Victorian AFL team that has not been in financial trouble within the last 20 years or so?

A: Essendon! And that's it!

And that is because...

They all try their best but they can't get near

 

[vjknight]

Re: North on the Brink

lol I am an accountant and I have worked for the largest accountancy firm in the world for many years.
I have clearly explained that as a business things have improved dramatically over the last three years, there are some timing issues some have focused all their attention on.

over that 3 year period TAS, has norths position improved to the point where now, or in the immediate future, they will be able to keep up with the joneses ? i imagine their efforts at arden st are to try to replicate those of the well equiped clubs. or do their numbers suggest they'll always be financially, 5-10 years behind.

A fairer draw with increased FTA exposure would increase revenue from sponsorship and coperate sources which are a major source of revenue. Even if the gate receipts increased by only a small portion it would still make a significant improvement to the club if we could sell the club to corporations knowing in advance we would not get screwed in terms of scheduling.

FTA dont want them due to insufficient ratings - end of story. so that has to be taken out of the equation. what else ya got that is relevant ?