Only five AFL clubs made a profit in 2013 without the assistance of poker machines, according to figures presented to the clubs by the AFL.
And remarkably, one of the clubs that made a pokies-free profit was North Melbourne, which made a decision to avoid poker machines from its business model, and is among the smallest clubs for revenue.
The five clubs that made a profit without non-football revenue - almost all of which is from poker machine venues - were Collingwood, Richmond, West Coast, Fremantle and North Melbourne. The Kangaroos are the clear outlier from that group of five and, according to the club, made a profit of $1.3 million in 2013 as a result of running a very low-cost operation.
Even Hawthorn, the 2013 premier and one of the game’s most financially robust clubs, had a profit that was assisted by pokie earnings. The Hawks made a healthy profit of $3.1 million in 2013, but they are understood to have earned more than $4 million from their lucrative Waverley Gardens gaming venue, and have plans to earn more from their new Caroline Springs venue.
Geelong, another fiscally strong club that has excelled at all levels, confirmed to Fairfax Media that it would not have been profitable in 2013 without poker machine earnings. The Cats made a net profit of $1.2 million last year.
Carlton earned profits of about $2.7 million from its poker machine operations - spearheaded by benefactor and pokies magnate Bruce Mathieson - which helped it to record a profit of $528,095.
While the fact that even strong clubs such as Hawthorn, Geelong and Carlton were not profitable without gaming assistance, this can be misleading, because clubs say they spend according to revenue generated. Hawthorn is spending heavily in the knowledge that it has a buffer from poker machines. The Hawks and Cats could simply decrease their spending without the pokies profits.
Clubs were presented with the fact that only five had made money from conventional football incomes - read, without pokies - at a recent meeting of chief executives.
The presentation, by the AFL’s chief financial officer Ian Anderson, was viewed by some club officials as a warning about escalating costs and the precarious financial position of the clubs.
Collingwood made a massive operating profit of $5.22 million in 2013 (plus one-off grants of $11.15 million for its facility for a overall profit of $16.375 million), while Richmond did extraordinary well for a club without significant poker machine revenues, the Tigers making $3.3 million on the back of a hefty membership, gate receipts and the team’s improvement to play finals.
West Coast and Fremantle do not have poker machines and still managed healthy profits, with the Eagles reaping $4.1 million.
But the major surprise from the survey of clubs’ profitably and gaming operations are the Kangaroos, whose chief executive Carl Dilena said the club had run a lean operation that enabled it to make a profit of about $1.3 million.
The club did well from its two home games in Hobart, which industry sources suggested were underwritten to the tune of $500,000 a game, with the club also having close to 4000 Tasmanian members. Dilena said the Roos, who ranked in the bottom two for football department spending in 2013, hoped to increase their spending on players to 100 per cent of the salary cap this year via a pre-payment - paying players in advance for 2015 to reach the limit this year.