SANFL AGM Report

Zac Milbank wrote:
Monday 17th March 2014

2013 AGM: SANFL HEADED BACK TO PROSPERITY

The SANFL is looking ahead to a period of sustained prosperity following the official conclusion of the 2013 financial year.

The League held its Annual General Meeting tonight (Monday 17th March 2014) and tabled its 2013 Annual Report, showing the SANFL made an underlying profit of $2.13m excluding depreciation, stadium write-down and abnormal items.

In 2013, the SANFL also reported:

- a positive net cash flow from operating activities of $3.8m compared with $1.3m in 2012;

- an increase in cash on hand at the end of the year of almost half a million dollars to $1.7m; and

- a 3% operating expenditure reduction.

The statutory loss of $12.4m was largely due to the continued write down of AAMI Stadium; a planned process undertaken to reflect the future revenue and value following the shift of AFL football to Adelaide Oval.

However, the SANFL will soon be able to recognise the value of the license it has to use Adelaide Oval for the next 80 years – which has been independently assessed by Ernst & Young at $93.5m – which will return the SANFL’s asset value to in excess of $100m in 2014.

“The League’s financial business plan shows a significant improvement in earnings from the 2014 season when football is played at Adelaide Oval,” said John Olsen AO, Chairman of the South Australian Football Commission.

“In addition to revenue opportunities, the League has implemented a lower cost structure as it will no longer be running a major stadium,” he said.

“The League’s commitment to provide additional funding to the Port Adelaide Football Club has concluded at a total of $14.75m - a fact not understood, recognised or appreciated by many.

“The elimination of this exposure upon the transfer of licences combined with the financial benefits of moving to Adelaide Oval will allow the SANFL to commence a debt reduction program from 2014.

“The underlying business continues to be profitable and the level of profit will improve as a result of a higher financial return from Adelaide Oval.”

Mr Olsen said the SANFL would also use the proceeds of selling land at AAMI Stadium to reduce its debt.

“After a process that has taken three years to get the land at AAMI Stadium rezoned, the SANFL went to market with an Expression of Interest process that concluded last week. We are currently evaluating the bids received to purchase all or part of the land,” he said.

“Inclusive of the proceeds from the sale of land, the SANFL expects to be able to fully repay its debt in coming years.”

The SANFL also reported strong participation numbers for 2013, including:

- more than 113,000 participated in football in South Australia and involvement at club level across the State rose to more than 45,000;

- the number of children aged 5-12 increased by 7.5% while total Primary and Secondary school participation increased by 13.5%; and

- participation in the South Australian Women’s Football League increased by 27.5%.

Mr Olsen also reflected on the wide range of issues dealt with by the Commission over the previous 12 months which included the AFL licences, the move to Adelaide Oval, the rezoning of AAMI Stadium and AFL ‘second’ teams in the SANFL competition.

“I doubt whether there ever has been a time with such diverse, complex and demanding issues on the table all at once,” he said.

“However, the hard work is not over and only continued financial vigilance, innovative thinking and a spirit of collaboration will see our potential realised.”

“The League’s commitment to provide additional funding to the Port Adelaide Football Club has concluded at a total of $14.75m - a fact not understood, recognised or appreciated by many.

Chambo Off To Work We Go wrote:Do you mean $90M for AAMI or Adelaide Oval? The report says it is for the AO Licence.

Given the specific and singular nature of this deal, how do you go about valuing it as an asset? There aren't too many similar deals to compare it against I would think and those that you do are very possibly interstate. I guess it is nice to have on a balance sheet, but how accurate would it be? Perhaps the proof of that is if the SANFL wanted to and were able to borrow against it.

How big are stadium write offs?
I presume these are P&L trading items rather than balance sheet.

Sometimes these reports mix P&L and Balance Sheet items and it is hard to get a picture of what is what. And it probably confuses the public who may not be accustomed to reading financial reports.

I guess the full Annual Report would disclose all of this.