I see the AFL took out a $600 million loan today. That’s a sizeable loan when you look at the AFL’s 2019
Financial Statements that state the AFL had:
i. a revenue of around $794 million;
ii. expenses of around $765 million;
iii. net equity of around $240 million; and
iv. around $180 million in cash.
Obviously finance - if you can get it - is reasonably cheap at the moment, but assuming something like 5% interest on that loan, the league’s entire profit from last year would be taken up just servicing the interest. Assuming some drop in revenue next year from memberships, sponsorships and TV money reducing, that level of debt is no small thing.
The AFL is going to have to significantly reduce its expenses, which as many on here have mentioned isn’t necessarily the worst thing.
I’m glad the AFL didn’t need to rely on blokes like McGuire and Kennett to sign up their clubs to underwrite the league’s survival because you can’t rule out someone coming up with some idea like a SuperLeague with the biggest 12 teams playing twice (or a Division 1 and 2) to entrench the rich clubs’ positions.
But someone is going to be taking a long, hard look at clubs like GC17 and any new TV deal very soon.