Demons achieve profit in 2009

[Demonland 66,979]

http://www.melbournefc.com.au/news/newsart...48/default.aspx

Great News!

[Gooner 9]

Great news!

Even if the operating profit is only $20K, it's better than nothing.

There looks to be a number of one-off expenses which shouldn't reoccur next year.

Hopefully we'll continue to expand our membership and have some more success on field to increase attendances and move on to greater things in the next few years.

[True Believer 1]

fantastic news... a great christmas pressy for MFC

Edited December 21, 2009 by True Believer

[Skipper3 7]

Great news!

Much better than a loss after a year like we have had...

[H_T 2,941]

AFL CEO Andrew Demetriou said of the result, “This result is a great credit to Jim Stynes, his board and CEO Cameron Schwab and the enormous amount of work they have done to turn the club around by reducing debt, attracting corporate sponsorship and re-igniting the passion of so many Melbourne supporters.”

The ship has turned.

Debt Demolition has reduced the club’s debt from $5m to the current $1.5m, with some contributions falling into the 2010 financial year. The club’s debt will therefore be reduced to $1.1m next year.

[beelzebub 22,743]

its not so much the number.( and its still good news ) ..but the direction the finances have taken ..i.e ^..and not v

[Keyser Söze 0]

...

Fortunately the club is not only concerned with a profit/loss figure, but also takes a more long term view with consideration of other factors that arise with paying out a player's contract.

If we were that desperate for Dylan Grimes we'd have taken him in the National Draft or PSD at the expense of someone else.

[Choko 493]

Hold on a sec.

The books are independently verified and signed off by one of the huge accounting firms. So to suggest they are manufactured is a big call.

In addition, you can't equate one decision to the financial performance of a multi-million dollar turnover organisation.

Anyone who has anything to do with accounting knows this figure is most likely "window dressed". The fact it's $20,000 shows how well managed the profit is.

For some reason people seem to think a "profit" is important but it has been achieved at the expense of Dylan Grimes (and perhaps the FD desire to honour contracts to Meesen and Newton).

If we had delisted Newton or Meesen and paid them out that would have put us into a loss situation (on an operational basis). But by doing so we could have had a crack at a youngster who may play AFL footy rather than have two players on our list who most probably won't.

Personally I'd have been happier with a loss and a different player than a profit and both of these players. I hope we made a FD decision here and not a PR one.

[H_T 2,941]

Anyone who has anything to do with accounting knows this figure is most likely "window dressed". The fact it's $20,000 shows how well managed the profit is.

For some reason people seem to think a "profit" is important but it has been achieved at the expense of Dylan Grimes (and perhaps the FD desire to honour contracts to Meesen and Newton).

If we had delisted Newton or Meesen and paid them out that would have put us into a loss situation (on an operational basis). But by doing so we could have had a crack at a youngster who may play AFL footy rather than have two players on our list who most probably won't.

Personally I'd have been happier with a loss and a different player than a profit and both of these players. I hope we made a FD decision here and not a PR one.

How do you know that ?

Why make a statement such as the profit "has been achieved at the expense of Dylan Grimes"

then - " I hope we made a FD decision here and not a PR one"

The club was quite clear in it's intentions with Meesen & Newton, and it effectively enabled the club to utilise picks 34 and 50.

In addition, had Dylan Grimes not been picked at No.2 in PSD, he could have easily been picked up by another club in the PSD or with no#'s 1-5 in the Rookie Drfat by the Gold Coast.

It would have been a FD decision relating to List management, not a PR exercise.

I guess some just can't let go of D.Grimes.

Edited December 21, 2009 by High Tower

[45HG 1,539]

The implication is also that you'd rather have Dylan Grimes, a player overlooked by all clubs several times, than make a profit.

[Keyser Söze 0]

Yes, you've got the point, but it doesn't have to be Dylan Grimes. As you know many a good player has been selected in the PDS and RD as well as taken at the rear of the ND.

Your point is flawed because it also at the expense of our reputation for keeping our word when dealing with player contracts.

It would undo a lot of the good work done in recent years.

I hardly think Grimes or any other player taken as a rookie is worth that much.

"No player is bigger than the club."

[beelzebub 22,743]

The ship has turned.

shhhh.lol

[H_T 2,941]

shhhh.lol

I was expecting a shark who only visits these warm waters occassionally, not you BB. You've taken my lure/bait. I'm taking my rod home now.

[tarzan16 40]

proud of this club, proud of or president, proud of the players, proud of the fans. we are on our way back. enjoy carlton brock. you're gonna regret this.

[Deeoldfart 7,864]

Anyone who has anything to do with accounting knows this figure is most likely "window dressed". The fact it's $20,000 shows how well managed the profit is.

For some reason people seem to think a "profit" is important but it has been achieved at the expense of Dylan Grimes (and perhaps the FD desire to honour contracts to Meesen and Newton).

If we had delisted Newton or Meesen and paid them out that would have put us into a loss situation (on an operational basis). But by doing so we could have had a crack at a youngster who may play AFL footy rather than have two players on our list who most probably won't.

Personally I'd have been happier with a loss and a different player than a profit and both of these players. I hope we made a FD decision here and not a PR one.

A very narrow and ill-considered perspective I'm afraid. Have a re-think Peanuts.

[H_T 2,941]

I think on balance that you're right; I think that it's important to honour contracts, but it doesn't mean the other view is without merit or consideration.

It doesn't mean you're point is right either.

You're speculating re: window dressing the profit. Even though it may have happened in the past from previous boards.

The LM's decisions (Between Trade and National Draft period) I gather were made well ahead of the finalising of balancing of the books.

Regardless, your comment: -

It seems to me that the club was desperate to "make a profit".

Is mere speculation. And your previous quotes regarding the profits have been achieved at the expense of Dylan Grimes {or insert other player} are non-factual; wrong re: PR exercise.

Edited December 21, 2009 by High Tower

[beelzebub 22,743]

I was expecting a shark who only visits these warm waters occassionally, not you BB. You've taken my lure/bait. I'm taking my rod home now.

dont mind a bit of flake ..............................................................

[beelzebub 22,743]

A very narrow and ill-considered perspective I'm afraid. Have a re-think Peanuts.

Tend to agree... it ( the premise ) is supposed upon one particular event( choice) resulting in another particular outcome. That without establishing any bona fide links as to cause and consequence.

The reality is its hardly this at all.

[Gooner 9]

Peanuts has a point in that the profit may be massaged a bit, but it doesn't mean that the accountants at the club stopped us from getting Grimes.

Firstly, any player payments would've been in 2010, so that wouldn't have effected the profit.

Secondly, with particular reference to Grimey Jnr, he was picked by Richmond, so we had to choose between Macca Jnr or Grimey Jnr with pick 1 of the PSD.

The FD obviously decided that an experianced head was a better option than a kid with unknown potential.

[Mega_Watts 70]

Getting back to financial report, here's a question for an accounting type:

It is stated repeatedly in media releases that the club's debt is now $1.5m.

How does this reconcile to the Statement of Equity and Balance Sheet, both of which suggest the club's accumulated losses = $3.2m?

I would have thought accumulated losses = debt.

Can anyone explain?

Also, I note that the club's revenue actually fell quite significantly from 2008 to 2009 by $1.35m.

This seems to be mainly attributable to a fall in Marketing/Corporate sponsorship and fundraising of $1.25m.

Whilst I commend the club for the cost reductiions it has implemented, I'm simply pointing out that the news is not all great as some on here would suggest.

Further, it looks as though much of the reduction in expenditure is due to a reduction in staff payments, most likely brought about by a lower staff turnover and thus lower redundancy payouts etc.

[Gooner 9]

The retained earnings/accumulated losses is the past profits or losses. Basically, it's a balancing account representing the profits or losses and how much they've contributed/diminished the capital of an entity.

They differ from debt in that they represent prior losses, where as debt represents the amount that is outstanding at the end of the financial year.

Expenditure, which obviously creates losses, can be funded from a number of sources. It can be funded from borrowings (i.e. increasing liabilities, the reduction of assets such as reducing cash holdings, selling assets etc, or equity such as issued equity.

As Melbourne FC doesn't have equity, it's one of the first two options.

Basically, the accumulated losses are financed by:

a) debt of $1.5m

B) payables & income rec'd in advance less cash, receivables & equipment of $1.7m (see the balance sheet for individual items)

It's mostly debt and payables though.

We've also got $1m worth of membership contributions that we haven't recognised as income yet, although we haven't recognised the expenses related to that income either.

Hope this makes sense and I haven't confused you more.

[Gooner 9]

Also regarding the drop in sponsorship - I assume this relates to the fact that we didn't have a major sponsor until just before the season commenced.

[Jarka 767]

Just a point on the Newton & Meesen decision to move them to the rookie list, this actually allowed us to pick up two extra players in Gawn & Fitzpatrick. Obviously it's early days but imno I thought they did pretty well with that decision it's rare that clubs will pay out a contract, it's really is just wasted money.

[jayceebee31 692]

I think Gooner has answered the financial queries quite well, and from a business perspective it is very important for any organisation that confidence and a positive factor ( profit) gives an underpinning to postive momentum thus foundation. Also,with the debt now only $1.1 million with a strong probability of a greater increase in profit underlies the growth and opportunities over the next five years. (it is usual for a board to look at a strategic plan over this timeframe).However, the costs of our training venues will have a greater impact.

And do not forget we gain a $100,000 per home match starting next year as well as extra sponsorship money (Volvo-short sponsor).

GO DEES GO.

Edited December 21, 2009 by jayceebee31

[Hazyshadeofgrinter 80]

Congratulations to the MFC for achieving 5 out of 6 years of profit since 2004.

Let us hope that the profit figure of $20k does not lead some of our demonland members to state that this year's financial report is

dubious

let us also hope that said members do not state that

The smallish profits paint a false picture of the real situation.

and that they amount to

arguably successful efforts

hypocrite.