Local clubs kicking goals off field

13/02/2008 - 22:00

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As the debate over Perth’s new multi-use stadium has demonstrated, AFL wields the most influence of all codes in Western Australian sport, with the state’s two clubs among the most financially successful in the national competition.

Local clubs kicking goals off field

As the debate over Perth’s new multi-use stadium has demonstrated, AFL wields the most influence of all codes in Western Australian sport, with the state’s two clubs  among the most financially successful in the national competition.

The West Coast Eagles had their strongest financial year in the club’s history in 2007, converting a premiership win in 2006 into a healthy profit margin.

The club posted a profit of $6.6 million before royalties on the back of a turnover of about $46 million.

This translates to almost $3.9 million in the coffers, after the West Australian Football Commission takes its share in rent and AFL royalties.

Eagles chairman Mark Barnaba said the club’s profit – up 20 per cent on the previous year’s $4.7 million – was an impressive result.

“It’s certainly a record for the West Coast Eagles and arguably one of the biggest profits of any sporting club in the country,” he said.

Retail sales and merchandising in particular (up 13 per cent on the previous year) carried much of the increase in revenue, according to Mr Barnaba.

“A lot of it also came from squeezing revenue spots and controlling costs,” he said.

Despite the club’s off-field issues during the past 12 months, the Eagles are yet to see any collateral damage in sponsorship and membership.

The club has retained its key sponsors and added several others, Mr Barnaba said, putting it on track to exceed its sponsorship budget of $7.2 million.

Membership is also tracking well, with less than 1 per cent non-renewals.

Compared with this time last year, the club has an extra 4,500 non-seated members.

Given the new stadium will increase capacity by 17,000 seats, the Eagles can be expected to significantly increase membership takings from 2014 onwards.

Across town, Fremantle Football Club is no longer the poor cousin of football in WA.

The club, which is yet to finalise its accounts, will post a profit of about $1.5 million for 2007, within a total turnover of more than $35 million.

It’s a far cry from 2001, when the club made a loss of about $2 million.

Fremantle Football Club chief executive Cameron Schwab said that, while on-field performance did have an impact on the bottom line, it was to lesser effect than in the club’s early days, up to season 2003.

“The objective is to make ourselves as least affected by (on field performance) as possible. The reality is it does, but it certainly affects us less now than it did in the past,” he said.

Fremantle will meet its sponsorship budget in 2008 and has options to renew its contract with major sponsor, global electronics retailer LG.

The original three-year deal, signed in November 2005, was reported to be worth $3.5 million, although it could be expected to generate a lot more revenue for the club this time around.

According to market research group S-COMM, the LG logo worn on Fremantle’s jumper is the second most recognised brand of any team in any of the football codes played in Australia.

On the membership side, numbers are yet to be finalised, although the club believes it will match last year’s total of 43,343.

Having improved its financial performance, Fremantle has also been going through a growth phase.

The club has 73 full-time equivalent employees, in addition to the playing group and 15 part-time support workers.

It’s a significant increase on the 29 full-time employees the club had in 2003.

According to Mr Schwab, focusing on staff recruitment helped the club achieve success in other areas.

“The most important decision Fremantle took...was to get as many good people into the organisation as possible,” Mr Schwab said.

“That’s one of the strengths a football club has, because it’s seen as an exciting, vibrant, positive work environment. Without necessarily paying a whole lot more cash, you can attract quality people.”

The club had a recent coup in recruiting Wesfarmers chief Richard Goyder to its board, which Mr Schwab said was three years in the making. The club also expects to add a new board member this year. 

Stadium a good fit

“What has been talked about is some funding to be made available in the interim to improve Members Equity, principally to improve the corporate facilities. It may impact capacity, but not too much,” Mr Stooke said. 

Mr Gooch said there was a longer-term plan for the stadium.

“There’s been talk of a two-stadium policy. Ideally, once the multi-purpose stadium has been completed, some focus can come on to a more suitable rectangular venue,” he said.

Meanwhile, the Western Australian Cricket Association is likely to use the new stadium for big 20/20 games, but not Test matches.

WACA chairman David Williams said the organisation’s position had not changed.

“We’ve always held the view that there’s room for both [the WACA and the multi-purpose stadium]. We use South Australia as an example, where they have Football Park and Adelaide Oval,” he said.

Mr Williams said the WACA had abandoned the idea of a state government-funded development of its ground some years ago.

“The government had made it clear that they wouldn’t be providing funding to the WACA if it was used by a single sport,” he said. “We talked to rugby, but we weren’t successful in attracting them.”

The organisation is still in the planning stages of a development of its ground, which would be funded by Ascot Capital Ltd and would increase capacity to about 27,000 seats.

It also plans to apply for $13 million in federal and state government funding for a training ground in Floreat.

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