As a result the SANFL will immediately re-invest an additional $2.5 million into the club. This is on top of $1 million invested in December.
The cash re-injection precedes the completion of detailed negotiations regarding a new ongoing stadium deal for both the Power and the Crows at AAMI Stadium, which will be finalised within three months.
Port Adelaide President Brett Duncanson says the club will apply the immediate cash re-injection in line with its Business Sustainability Plan – to reduce debt, to provide revenue certainty for the next two years, and to begin strategically investing for growth.
“This investment by the SANFL back into our business certainly eases the pressure on the club and importantly will allow us – when coupled with support from the AFL – to focus on delivering long-term growth,” says Duncanson.
SANFL Executive Commissioner Leigh Whicker says the SANFL is determined to ensure that Port Adelaide grows and prospers in the AFL, and the club has the Commission’s total support and confidence.
“The SA Football Commission and the Port Adelaide Football Club Board will continue to work together on both short and long-term strategies to ensure the ongoing sustainability of the club,” says Mr Whicker.
“A healthy and prosperous Port Adelaide is good for all football in South Australia.
“The Commission has complete confidence in both the Port Adelaide Football Club Board and Administration in taking the club forward and they have our total ongoing support.”
The Power will now meet with the AFL regarding further assistance for debt and revenue certainty, while also implementing other key elements of its Sustainability Plan. The AFL had been waiting for the SANFL to act prior to deciding its level of commitment.
Port Adelaide’s Business Sustainability Plan has five key elements:
· Significantly reduce debt
· Medium-term revenue certainty … special assistance from the AFL (ASDs) and the SANFL to cover projected revenue gaps for the next two years while a new stadium deal is put in place and a strategic plan to generate growth begins to be implemented
· A new stadium deal and new ongoing financial arrangement with the SANFL … to include retaining a higher percentage of revenue generated from putting on the “show” (to be completed within three months); growing overall stadium yield; and obtaining a land footprint at West Lakes equal to the Adelaide Football Club
· Address and turn-around gaming and licenced club losses
· Explore and implement medium and long-term strategic growth options to boost membership, attendances and revenue
The last element will include immediately investing in more key staff within the off-field side of the business, with SANFL and AFL support.
Duncanson says the club’s Business Sustainability Plan provides a methodical approach to rebuilding Port Adelaide’s financial position and creating a sustainable ongoing business model.
“This process is not about the short-term, this is about changing the long-term business model in partnership with our key stakeholders,” Duncanson says.
“We have firstly undertaken a detailed examination of the club’s finances and forecasts, and communicated the results of that to those stakeholders.
“They now understand and accept our position, and have agreed to work closely with us to methodically rebuild our business model so that it is sustainable well into the future.
“To allow that methodical rebuilding requires us to access a greater share of the revenue we generate at our home matches, but also a short-term cash re-injection for debt elimination and revenue certainty.
“We have been talking to both the SANFL and AFL about those requirements, and appreciate how both our parent bodies have genuinely committed to providing a level of investment which will allow us to focus undistracted on longer-term planning and growth.
“We will now tackle the next stages of the rebuilding process.
“This will include finalising discussions with the AFL; completing a new strategic plan which is focused on growth; and securing that changed ongoing stadium arrangement with the SANFL within the next three months.”
Duncanson said improved crowds at Port’s home matches at AAMI Stadium this year and efforts to cut costs with the SANFL were also yielding good results.
“We are pleased that our crowds are up 15 percent on last year when comparing like games,” Duncanson said.
“If that trend continues, then combined with the efforts to cut costs it will substantially reduce our projected full-year stadium net loss under the current arrangements from the original budget estimate of $777,000 to somewhere closer to $400,000.”
