The financial situation at the club has been of major concern for a long time. Next year doesn't really look like it will improve the situation, in fact unless I've got things wrong, it looks like it might all come to a head. Here's my understanding:

We owe around $7M to the NAB.
The NAB won't extend our loan any further.
We owe around $1.5M to the AFL.
This is due to be repayed at the end of 2007.
The club has no cash reserves of any significance. (This is my assumption based on us taking the AFL loan this year to cover cash flow issues)

Next year we are budgeting for a loss of around $1M.
This is after having a full complement of sponsors.
This is assuming we can get 30,000 members on board, an increase on this year. (28,000 members would mean a shortfall of approx. $500K)
This is after we receive a significant increase on our allocation of the internet money from the AFL (approx $500K/year extra).

This means that next year we are going to need to cover a $1M loss (assuming things go to plan!) and find another $1.5M to pay back the AFL's loan. Am I right? Does this mean we will need to find $2.5M from somewhere next year just to survive, even if the board's financial plans come to fruition?

Hopefully someone with a better understanding of the financial side of things can either correct my mistakes or explain how we will be able to survive the year, because to me it looks like we might struggle to make it through the year.

The club have hopefully included the 1.5 owed to the AFL in there budget for 2007. Can't confirm that though.

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Mjonc signing off at 8888

If the repayment is due in 2007, then it would have been applied to the budget forecast and be part of the $1m loss projection. This means in normal operating terms, we would be budgeting for a 500k profit. If this is right, that would be pretty good. Achieving it is the unlikely part.

Yep it makes sense that the 1.5M repayment would be included in the budget.

Is there any way to find that out for sure?

The big problem is that even if the $1.5M is already budgeted for, we're still looking at a loss of $1M. Where is that going to come from?

I also haven't seen any new initiatives that would give me confidence in a prediction of a rise in membership. It all seems very similar to last year, so I'm not sure where the extra 2000 members will come from.

Unless we get the NAB to forgive some debt (a la Bendigo Bank and Geelong style) we are in serious financial do do. Still. I'm sure the board invent 1/2 the shenanigans that get leaked to take the media's eye off the fact that we are horribly insolvent.

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I support Carlton, Fulham and I'm an accountant - my mate calls me a 3 time loser.

Look, were half way through a 3 year plan......it will be ok...

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Due to recent budget cuts and the rising cost of electricity, gas, and oil....... the Light at the End of the Tunnel has been turned off. We apologize for the inconvenience.

What a wonderful financial 3 year plan it is.

Implemented in 2004, the high regarded 3 year financial plan was mentioned in the mid year season review to sponsors.

Under the heading business strategy, it states "the club is continuing to implement its 3 year financial strategy in creating a financially buoyant and independent club"!

A financially buoyant and independent club!!!!

Approaching the end of this 3 year plan, where are we?
We have a massive debt with the NAB which requires the goodwill of the AFL to let it remain.
The NAB have told us there is no more money.
We have a loan from the AFL to pay our bills to see us to christmas.

During this time we have recieved Waverley money, heroes money, relocation money to move to TD. We've sold anything which is'nt bolted down.

And where is our 3 year plan? In the crapper where it belongs.
Look on the bright side, not only have we a group of nuffers in the board room, they're inviting their mates on as well.

Dont worry about letting the members decide with an AGM, our job is to shut up and let those in power decide for us. Welcome to the transparent Carlton we were promised.

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Looking forward to seeing our potential realised.

Get you BF avatar up!

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dane's trolling again

For your information the loan from the AFL is a balance sheet item and has no bearing on profit. The loan is a current liability and if and when it is paid back it impacts on cash flow and not profit.

woof, what does that mean in terms of my original post? Does that mean that we're up for a $1m loss and if we pay back the AFL loan it will become a 2.5m loss?

Can you elaborate how it might affect us next year?

Better?

I don't want this to become an accounting exercise but to put it very simply the repayment of the loan to the AFL does not directly impact on profit and loss. It impacts on cashflow, the club this year needs to generate an extra 1.5mio cash to meet this committment to the AFL when it is due.
With our sponsorship deals being all full up we probably need an extra 6000 new members to sign up to generate the cash

Marcus Rose reckons our business acumen is the envy of all other football clubs....

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Due to recent budget cuts and the rising cost of electricity, gas, and oil....... the Light at the End of the Tunnel has been turned off. We apologize for the inconvenience.

I am reading that book on the history of WA Football right now... and came across a passage about the entry of the Eagles to the comp. in 87.

Basically it says that there were only three "solvent" clubs
1) carlton
2) hawthorn
3) Essendon*

all the others were broke... look how times change.

I think the AFL owes Carlton to at least get it back on its feet - none of this minimal loan stuff.

There is only so much money supporters can give.

the very worst case scenario is that instead of a loan from the AFL we get given money ala basket cases like the Kangas and the Dogs. If ever there is a time to be financially incompetent it is now, 10 years ago we/they would have been hung out to dry. Now with the TV rights the AFL have painted themselves into a corner where they bail out struggling clubs.

For the record I don't agree with this & I feel very sorry for Fitzroy supporters whose club would have been saved by the AFL in its current format.

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Between our dreams and actions lies this world

Article in todays HUN about Freo being 8mil in debt four years ago, now making million dollar profits year after year.

http://www.heraldsun.news.com.au/footy/ ... 22,00.html

Good case study for Smorgon.

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Mjonc signing off at 8888

A great case study if we eliminated 14 other teams from Melbourne. Whilst there is no doubt on-field success will help us - major sponsors are staying away until we get our house in order. We have only minor sponsors - our Dan Murphy deal would only get them on Collingwoods' shorts during away games.

I'm afraid it's the aforementioned clubs success that must be the blueprint for our success. And should the club succeed at that - we'll be in a better position than the Pies as our HQ will still be Carlton.

Have you been living under a rock?
We have got the loan and we also get a distribution that is a little less than Kangas, Dogs and Dees as of next season.

AAAAAAAHHHHHHHHHHHHH SMORGON.

When did the NAB give us a further $3,000,000???

This time last year we had a $4,000,000 facility of which we had used $3,685,000. How come we owe NAB $7,000,000?

Is it the money we had to put in for the redevelopment?