Debt now approx. $1.5 million

[rpfc 28,779]

I think the club wants to make the Debt Demolition completely a fundraising event and not use profit on eradication of debt.

But surely we would make a decent profit this year with everything that has happened and next year the club could say we will have no 'night of the big wigs' and instead say that individual donations will be accepted during August and the club will match dollar-for-dollar the funds raised.

Essentially, $750 000 of MFC's money pays off $5m debt?

I think Ron Walker is getting sick of going to exrtremely expensive MFC functions...

[Rogue 585]

I think it's quite clear that Debt Demolition will continue until the debt is demolished.

I imagine this will take at least two years, perhaps three.

Once we start making profits, this can help wipe out the debt.

I think any 'profits' will be reinvested into our under-resourced organisation.

A more accurate depiction of the generosity of supporters would be to look at the donations as a % of discretionary spending.

I think this would give a more charitable view - no pun intended - of the generosity of our supporters.

We're certainly reliant on the well-off to contribute a bulk of the funds though.

[H_T 3,049]

This article also says our debt was reduced to below $1.2m in August?

Thanks for that link 45h16. I thought it was reported initially around that $1.2 million mark in debt.

So now it's $1.5 million in debt. Let's hope it doesn't balloon out any further.

Edited October 13, 2009 by High Tower

[darkhorse72 1,925]

Most likely the debt was around 1.2m in August and then you add interest Raising up slightly again.

If you think at the rate that the debt is being reduced their isn't much more that the club can do without straining its relationships with its members and supporters.

Think of it this way, if you had a $500,000 mortgage on your house and it two years you had it down to $120,000 wouldn't you be stoked!

I know I would be.

Remember each year the interest competent is less so the principle is reduced faster therefore raising say another $800k next year will have more impact on the debt.

Personally I think the club will able to wipe the debt next year even if they draw money out of the normal operations of the club. Also maybe come to an arrangement with the financiers of getting a discount by repaying it early/now. I remember Geelong getting a million and a bit off heir stand debt by cook arranging to pay the debt in full earlier a few years ago.

[Hazyshadeofgrinter 80]

We should seriously be starting to make profits... in the past we have made $1m losses, but since then...

- we are paying $700,000 less a year in total player payments

- $1m extra from stadium deals

- $1m from MCC

- $1m from AFL

- good sponsorship deal

- 32,000 members

Surely surely surely, considering the $800,000 of debt demolition and the above things, we will make a profit this year, even despite the GFC!?

Once we start making profits, this can help wipe out the debt.

Short memory?

The Club recorded net profits in '04, '05, '06 and '07.

You might also be interested to learn that the loss of approx $1.5m forecast for 2008 was around the same amount that football operations spending was increased that year.

Also, from memory, the club debt was around $4m in mid 2008 (down from $7m or so?). So "slashing the debt" to $1.5m after receiving $4m in donations is maybe not as good a result as it sounds (but not too bad either).

Cheers

Edited October 14, 2009 by Hazyshadeofgrinter

[w00dy 146]

profit and loss is profit and loss. The books for the club still run from July to June...like every other business in the country. They may show "other' tallies encompassing the calender year in various reports but the bottom line is our fiscal situation is benefited next year. It will only effect half the years income period ( or less really in terms of games )

Companies can have financial years run however they like... Most companies have a financial year finishing June 30, but many have December 31 year ends, and as previously mentioned, Football clubs have an October 31 year end... Take a look at our financial report when you receive it...

The club would still have to report GST quarterly, with a year end summary at June 30, but as far as their own financials go, it's October 31...

[Sir Why You Little 37,134]

We should seriously be starting to make profits... in the past we have made $1m losses, but since then...

- we are paying $700,000 less a year in total player payments

- $1m extra from stadium deals

- $1m from MCC

- $1m from AFL

- good sponsorship deal

- 32,000 members

Surely surely surely, considering the $800,000 of debt demolition and the above things, we will make a profit this year, even despite the GFC!?

Once we start making profits, this can help wipe out the debt.

You forget the word interest. A large debt requires a large payment which takes away profits made very quickly.

It's far easier to spend than save........

[H_T 3,049]

*BUMP*

New update on Mfc's Debt & Debt Demolition......:

http://www.melbournefc.com.au/news/newsart...47/default.aspx

[45HG 1,559]

Surely two threads didn't need to be bumped. Good news though, we will forever be indebted to Jim, his board and those few hundred supporters who made this possible - and Foxtel.

[hoopla 418]

You forget the word interest. A large debt requires a large payment which takes away profits made very quickly.

It's far easier to spend than save........

The purchase of additional equipment will slow the release of debt.

I hope the fund -raising strategy takes full advantage of the tax deductibility of donations to the Red and Blue Foundation.

If we assume that the marginal rate of tax for all potential donors is 38 cents , we could effectively get the general taxpayer to contribute $380 to the MFC for every $620 we get from our supporters.

I have described the workings of the Foundation on another thread

Edited November 5, 2009 by hoopla

[H_T 3,049]

Surely two threads didn't need to be bumped.

Perhaps not. St!ff bickies.

I thought this thread should have it too, so in future it might not be misleading to some. Bit of housekeeping.

[darkhorse72 1,925]

AS long as the debt is steadily moving towards $0 the rate will vary. If it increases then the problems will start. Personally if I was the MFC and announce a profit this year, after allocations for the footy department for next year from it, I'd pay it into debt to reduce interest. At least park it in an "offset account" for it

[hoopla 418]

AS long as the debt is steadily moving towards $0 the rate will vary. If it increases then the problems will start. Personally if I was the MFC and announce a profit this year, after allocations for the footy department for next year from it, I'd pay it into debt to reduce interest. At least park it in an "offset account" for it

Unfortunately.. I don't think the relationship with the MCC is quite THAT close

[Hobbits's 17]

Unfortunately.. I don't think the relationship with the MCC is quite THAT close

As long as YOU think that, thats all that matters.

[hoopla 418]

As long as YOU think that, thats all that matters.

OK , I'll restate it then to remove any ambiguity.

The MFC is not a fully fledged subsidiary of the MCC. The MCC will not therefore transfer funds through an offset arrangement