Clubs That Are Supposedly "In Trouble"

[slide rule]

Ok.

I've started this thread as a place where we can examine the performance of other Rugby League and sporting clubs in general.

I'm also doing this so that we can to gain a better perspective on our own situation, as I'm quite sure that we aren't the only club with financial problems. I feel that sometimes we can become a bit insular when considering our own situation, with little regard to what is happening around us.

A lot is written about the financial pain that many sports clubs are feeling. Not just here is Australia, but all around the world. We keep hearing about the debt levels of massive overseas clubs such as Man U and Liverpool. At home, there is an article about an NRL, AFL, A League or NBL team supposedly going under every second day. Yet, in comparison, it seems quite rare that they actually end up folding.

From what I understand, most sports clubs run at a loss and very few are sustainable in their own right. Most overseas clubs seem to rely on private ownership pumping money in. Many clubs seem to be no more than a billionaire’s play toy.

I'd like for people to comment and post any stories that they come across about clubs which are supposedly "in trouble" or suffering. I'd also hope to find out about clubs which have managed to turn things around.

I'm not starting this thread to be a debate about our club, rather a chance to glance across and see what else is happening out there.

It'd be good to get an idea of what works, what doesn't, and why?

:cheers

 

[Mark^Bastard]

Last year when we were going through our crap 3 or 4 clubs were named as being at severe risk. I'm pretty sure it was us, Eels, Knights and maybe one other.

In fact the Eels were seen as being the worst. They seem to have recovered very quickly though, at least in terms of money. Perhaps no coincidence that they achieved this while doing so well on the field in the back half of the season.

Things have gone quiet since, except for us of course.

I think at least we are standing on our own two feet. People go on about how Souths have turned it around but to be honest a millionaire bought them and even if they're technically making a profit now it's because he turned them around with initial cash injections. They can't be commended for that, their owner can though. They've still only made the 8 once in the last couple of decades.

Melbourne Storm are completely propped up by News LTD and even their on-field success it turns out has been an absolute farce.

So I see the Sharks as being a team that should be quietly working their way to a better future. Never gloating, just chipping away, and then at the end of it we can say we built our way back the right way, from within, and it'll have more validity. I would love for us to be propped up by smartly managing our assets and then as the momentum picks up by having a popular and successful team that people want to support.

The Shire itself has the population and geography to support a team, just as much as any of the other suburban teams do.

One thing I think is very telling is that we got 4,000 more fans to our last final game at the SFS than the Roosters did to theirs. We were playing Melbourne, they were playing another Sydney team. And 2010 was the best year for crowds and TV ratings.

Think about that. We do have fans. Don't let anyone tell you otherwise.

 

[Cara Jane :)]

Last year when we were going through our crap 3 or 4 clubs were named as being at severe risk. I'm pretty sure it was us, Eels, Knights and maybe one other.

wasnt the other one cantebury bankstown bulldogs?

 

[Mark^Bastard]

wasnt the other one cantebury bankstown bulldogs?

Nah I'm pretty sure the Bulldogs are a fairly well off club.

Could have been the Cowboys though they're doing better now as well.

 

[snowman]

3 clubs were in trouble last year, us newy and parra.
3 clubs asked the nrl for money this year, us newy and the titans.
newy will get there new owner.
what happened to the talk of us getting a business man?

 

[slide rule]

Here is an old story about the Doggies asking their Leagues Club for extra money. The Mergers also asked their club for more dosh.

Bulldogs bite leagues club for an extra $1m
Stuart Honeysett and Brent Read From: The Australian February 13, 2009 12:00AM


THE NRL has joined the list of global financial casualties after the Bulldogs were forced to ask their leagues club for an additional $1 million in funding.

They aren't the only NRL club that has asked for a further handout. St George Illawarra received an extra $500,000 from its leagues club last season.

The Bulldogs' request was approved last year and will take the grant the football club receives from Canterbury Leagues Club in 2009 to a whopping $5 million.

The extra $1 million is a safeguard to cover an expected shortfall in sponsorship revenue.

The club parted company with major sponsor Mitsubishi Electric last year and has been unable to secure a replacement as the effect of the worldwide economic downturn starts to bite into corporate Australia.

"We're hoping that we only need the $4 million but if we get to the end of the season and we need the $5 million, they've guaranteed that," Bulldogs chief executive Todd Greenberg said yesterday.

"The reason we went to them last year is because if they weren't going to do that then we would have had to cut some costs and slash some money off our budget.

"They're prepared to back us which is great."

The fact the Bulldogs were able to secure an additional $1 million is quite remarkable, given most NSW-based leagues club are looking to reduce their annual grants to football clubs as they counter the effects of an increase in state government poker machine tax and new smoking laws.

Canterbury Leagues club chief executive, John Ballesty, said he anticipated a tough year for all sporting bodies due to the global credit crunch.

"I'm sure Todd is still very hopeful that they'll still get a sponsor," Ballesty said.

"They've done a good job at the football club this year and they've got a very good roster, so hopefully they'll have a successful year and that will prove successful when they're talking to sponsors."

St George Leagues club general manager, Danny Robinson, confirmed the Dragons had asked for extra money as a result of poor performances early last season coupled with games at ANZ Stadium while Jubilee Oval was being redeveloped.

The decision meant the leagues club had to find additional money, given that it had already trimmed its annual grant to the football club by $2 million as it battled the impact of the pokie tax. "Our football club and our leagues club talk regularly. It's not as if we were ambushed," Robinson said.

http://www.theaustralian.com.au/news/bulldogs-bite-leagues-club-for-1m/story-e6frg7n6-1111118835995

It was right after the GFC so not much can be taken from it.

I think the Canterbury Leagues Club is doing pretty well though.

newy will get there new owner.
what happened to the talk of us getting a business man?

I haven't heard anything about a Newcastle owner?

LOL. I forgot about the rumor about our business man. Hopefully we have someone waiting just in case.:drunk

 

[Shark68]

wasnt the other one cantebury bankstown bulldogs?

The dogs are up there with the Broncos @ the meeting that the club had with the NRL the teams were Sharks, Souths,Manly,Eels,Knights and West Tigers they stated @ the time that the Eels would of been in a position similar to ours but sold a number of assets keeping them in the Black, Souths were running just as bad with no assets with Holms Acort and SSJ helping out they have no assets, West Tigers were in the same boat as us with their development on Victoria Rd having problems similar to ours, Manly also sold assets to keep afloat, Illawarra's was going under but had Saints bailing them out costing them a majority share Saints paid with selling off assets, Knights problem is a massive debt that they owe and I still think that they don't have a Leagues Club backing , they also lost a lot due to the delays in the new stands, The problem with selling assets is once they are gone what do you do when you need $$$$ again

 

[Shark68]

Here is an old story about the Doggies asking their Leagues Club for extra money. The Mergers also asked their club for more dosh.



http://www.theaustralian.com.au/news/bulldogs-bite-leagues-club-for-1m/story-e6frg7n6-1111118835995

It was right after the GFC so not much can be taken from it.

I think the Canterbury Leagues Club is doing pretty well though.



I haven't heard anything about a Newcastle owner?

LOL. I forgot about the rumor about our business man. Hopefully we have someone waiting just in case.:drunk

Jerry Harvey Stated that if he were to buy a Sydney NRL Club which one would it be, he said the Sharks, when asked what he thought he would have to pay he said If Russell Crow payed 3m for Souths he said he would expect to pay 20m for the Sharks

 

[slide rule]

A similar problem to us, but on a much, much larger scale

Liverpool on brink of financial collapse
Posted Sat Jun 6, 2009 7:12am AEST

Liverpool fans have been warned to be "very worried" after auditors revealed the club's parent company is in danger of being forced out of business by unsustainable debt.

The Reds' American owners, Tom Hicks and George Gillett, face a July 24 deadline to refinance 350 million pounds ($705 million) of debt which they have been servicing at punitive rates of interest, according to company accounts published this week.

The accounts revealed that the club's parent company, Kop Football (holdings) Ltd, made losses of 42.6 million pounds ($85 million) in the year to July 2008, largely due to 36.5 million ($73 million) of interest payments on the debt incurred by Hicks and Gillett to fund their February 2007 acquisition of the club.

In a note attached to the financial report, accountants KPMG warned that there was no guarantee that the creditor banks, RBS and Wachovia, would agree to renew their financing.

"The group has credit facilities amounting to 350 million pounds which expire on 24 July 2009," the note said.

"The directors have initiated negotiations to secure the replacement finance required by the group and these negotiations are ongoing.

"These conditions... indicate the existence of a material uncertainty which may cast significant doubt on the group's and parent company's ability to continue as a going concern."

Football finance expert Tom Cannon said the accountants were sounding an alarm that everyone connected with Liverpool should heed.

"Accountants like KPMG don't use the language they used lightly," said the Liverpool Business School professor.

"They are worried about the ability to continue on the present basis. I have not heard accountants talk about a top club in a way like that before. Fans should be very concerned."

Liverpool's underlying financial performance remains healthy with the club reporting an operating profit of 10.2 million pounds ($20 million) in 2007-08 on turnover which was up nearly 20 per cent.

That trend will have continued in 2008-09 following another successful season but Cannon believes the costs of servicing the debt will continue to drag the club down.

Cannon went on to argue that Hicks and Gillett would have to sell other assets to reduce the debt or bring in new investors.

Rogan Taylor, who has been attempting to organise a buyout of the club by fans who would then run it on the Barcelona model, said the latest figures showed how Hicks and Gillett had transformed Liverpool from a club with sound finances into a "debt-laden creature," to the anger of most of the club's fans.

Liverpool's ability to generate match-day revenue would be significantly increased by a move to a bigger stadium but plans to construct a new 60,000-seat arena close to Anfield have had to be shelved indefinitely because of the owners' financial problems.

-AFP

http://www.abc.net.au/news/stories/2009/06/06/2591181.htm

A more recent article (9 hours ago)

Reds at risk of points penalty

(UKPA) – 9 hours ago

Liverpool would be at risk of a nine-point deduction if the owners' holding company is put into administration, it emerged on Thursday night.

Initially it had been thought the Premier League would not penalise the club for Kop Holdings becoming insolvent, but now the threat of a points deduction has become a serious one.

The Royal Bank of Scotland could put Kop Holdings, the company owned by Tom Hicks and George Gillett, into administration if the Americans continue to block a takeover by New England Sports Ventures and have not paid off their £280million debt to the bank by October 15.

Under Premier League rules, the fact that the holding company is solely concerned with the ownership of Liverpool and football-related matters could trigger the nine-point penalty.

An insider said: "It is not completely clear whether the nine-point penalty would come into play but it would be a risk."

West Ham has been used as an example of why the Reds might escape a deduction if administration goes ahead when it was owned by Icelandic bank Straumur.

However, the Hammers were a solvent part of a whole portfolio of different companies while Kop Holdings is solely concerned with Liverpool.
Hicks and Gillett's legal action against the proposed takeover will begin in the High Court next week.

They'll be in serious poo if they get relegated.

 

[Sharky Pete]

A similar problem to us, but on a much, much larger scale

http://www.abc.net.au/news/stories/2009/06/06/2591181.htm

A more recent article (9 hours ago)


They'll be in serious poo if they get relegated.

My brother may be a Liverpool fan but as a mad Leeds fan, I'd deadset laugh if Liverpool got relegated.

Considering the major collapse we went throught you'd think other clubs would learn by now.

 

[Murphy]

wasnt the other one cantebury bankstown bulldogs?

richest club in the nrl followed by broncos

 

[snowman]

richest club in the nrl followed by broncos

both were behind the dragons this year mate as wealthiest teams in the comp

 

[slide rule]

Panthers could bring down Penrith as losses force club to shrink

• by: Nick Tabakoff
• From:The Daily Telegraph
• September 27, 201112:00AM

THE club industry giant behind the Penrith NRL team could be forced to offload a significant chunk of its sprawling empire as it battles multi-million dollar financial losses.

Internal documents show the Panthers Group will tomorrow close its West Epping franchise, with Panthers chairman Don Feltis admitting in a memo it is "economically unsustainable".

The group's losses hit $11.96 million last year - despite the fact it generated $154 million in revenue.

Insiders say West Epping could be the first of many of Panthers' 14 franchises to be closed or "de-amalgamated" from the group's Penrith head office in coming months - sparking alarm among unions about the future of workers' jobs.

The underperforming Wallacia Panthers is considered to be in the firing line for closure or separation from the group in the near future. Other candidates to leave the fold include one franchise in Albury and two in Newcastle.

Mr Feltis said yesterday a combination of West Epping losing "$150,000 a year for the last five years" and "continued economic hardship" had resulted in the decision to close the franchise.

He could not guarantee other Panthers franchises would not be closed "because decisions are made every month in the boardroom". He denied any decision had been made to close other clubs with poor results.

"We review the performance of all our clubs quite regularly," he said.
"But there's been no decision made at board level about any club other than West Epping."

Panthers will offer West Epping's staff jobs elsewhere.

But Tara Moriarty, state secretary of the Liquor and Hospitality Union, was worried the closure could be the start of a pattern that endangered jobs. "We need an assurance from Panthers that employees will not wear the cost of demergers and closures," she said.

Panthers went on a merger spree designed to make it the biggest brand in the NSW club industry under former chief executive Roger Cowan.
With these mergers Panthers still control more clubs than any other group in NSW. It is the fourth-largest club group in the state, with more than 72,000 members but the group over-expanded and took on debts from some of the clubs it merged with.

Asked if the $11.96 million loss in 2010 was a concern, Mr Feltis replied: "Of course it is. We would have liked the club to trade better than it did."
He also pointed out that directors had no choice but to "live with" the previous expansion under Mr Cowan, adding: "The current board inherited the growth that Roger Cowan put in place, and it is now its responsibility to manage that growth."

Mr Feltis has cited the GFC, smoking bans, the pokies tax and pre-commitment proposals as developments that threatened earnings.

http://www.dailytelegraph.com.au/news/sydney-nsw/panthers-could-bring-down-penrith-as-losses-force-club-to-shrink/story-e6freuzi-1226147341846

 

[squiddy]

wasnt the other one cantebury bankstown bulldogs?

Manly - they came within hours of shutting their doors a couple of years ago - now on very solid footing

 

[Gow's Scissors]

only thanks to private backers... the club is going to run a debt again this year of $1M and be payed off by the Penn's.

Manly arent on solid footing by any means

 

[Thresher]

Give the Sharks their share of the TV rights and there aint no problem

There's a lot of Sharks fans who don't live close enough to go to the games but we have value, we subscribe to Fox or watch Sharks games at the pub, we see the sponsors' name on the jersey and do our best to honour it, but what value does the club get from us, the NRL gets 100% Sharks get zero

Last year when we were going through our crap 3 or 4 clubs were named as being at severe risk. I'm pretty sure it was us, Eels, Knights and maybe one other.

In fact the Eels were seen as being the worst. They seem to have recovered very quickly though, at least in terms of money. Perhaps no coincidence that they achieved this while doing so well on the field in the back half of the season.

Things have gone quiet since, except for us of course.

I think at least we are standing on our own two feet. People go on about how Souths have turned it around but to be honest a millionaire bought them and even if they're technically making a profit now it's because he turned them around with initial cash injections. They can't be commended for that, their owner can though. They've still only made the 8 once in the last couple of decades.

Melbourne Storm are completely propped up by News LTD and even their on-field success it turns out has been an absolute farce.

So I see the Sharks as being a team that should be quietly working their way to a better future. Never gloating, just chipping away, and then at the end of it we can say we built our way back the right way, from within, and it'll have more validity. I would love for us to be propped up by smartly managing our assets and then as the momentum picks up by having a popular and successful team that people want to support.

The Shire itself has the population and geography to support a team, just as much as any of the other suburban teams do.

One thing I think is very telling is that we got 4,000 more fans to our last final game at the SFS than the Roosters did to theirs. We were playing Melbourne, they were playing another Sydney team. And 2010 was the best year for crowds and TV ratings.

Think about that. We do have fans. Don't let anyone tell you otherwise.

are the Roosters still backed by Jamie Packer?

 

[the big boy]

Penrith and The Titans are in real trouble.

 

[snowman]

Manly - they came within hours of shutting their doors a couple of years ago - now on very solid footing

i wouldnt describe manly's situation as solid... its better than it was in 2004, but nothing to write home about

 

[deano the p]

i wouldnt describe manly's situation as solid... its better than it was in 2004, but nothing to write home about

:good:

 

[WillyInBris]

Well from what I understand Para sold off a number of assets to get themselves out of trouble.

Manly have the Penn's and a couple more that would probably step up on the north side if need be but it does depends on the economy etc.

Penrith have a number of assets as well that they will probably sell off just like Parra did I would say but once they are gone they are gone.

The one that sticks out on the Radar is the Titans something just wasn't right down that way this year and I fear with another season like the one that passed they could be in real trouble....