The financial plight of the Greater Western Sydney Giants has been laid bare after it was revealed the club received two loans from the AFL totalling $2.5 million in the space of a year on top of a $23m grant from the sport's governing body.
In documents submitted to the Australian Securities and Investments Commission, the Giants logged a $1.985m loss for the 2018 reporting period and said they remained "economically dependant on the continual support of the AFL" to survive.
GWS received a loan of $1.75m from the AFL in November to cover a budget deficit, having previously borrowed $750,000 less than 12 months earlier.
The documents reveal the expansion club owes $1.475 million to the AFL and has $534,000 of cash in the bank. The $1.475 million is payable on demand by the AFL, although it is not expected to immediately pursue the repayment until the Giants have the available funds.
The AFL will continue to prop up the Giants despite the debts, with the club confirming the start-up franchise would receive almost $48 million in grants over the next two financial years. Their fortune is in stark contrast to NRL clubs, who now risk relocation or being wound up if they strike financial trouble.
AFL grants vary from club to club and some of the wealthier teams, such as Collingwood, Hawthorn and Fremantle, received only $11 million to $12 million last year. The other most recent AFL expansion team, Gold Coast Suns, were given a $23.7 million grant in 2018 and reported a $1.16 million profit.
It is a sign of the AFLs commitment to make the Giants work in western Sydney as the club blamed a number of variables for its loss in 2018, which was the third consecutive year in which they have made the finals.
The club had previously been forced to borrow $1.25 million from the AFL in 2014.
More than half of the AFLs clubs receive extra funding on top of their traditional grants.
In a letter to members earlier this month explaining the clubs first deficit in four years, Giants chief executive Dave Matthews said: "Our injury toll had the major impact on our financial result and inclement weather affected our gate receipts at several major home games.
"We do set ambitious revenue targets, but it is still disappointing not to record our fourth successive surplus.
"And while we dont rely on gaming revenue like many other clubs and we dont yet have the fan base and fan revenue of older clubs in traditional football regions, we have still achieved very strong growth both on and off the field."
Matthews pointed out on Wednesday that the Giants' inclusion in the competition ensured the AFL had an extra game a week to sell to TV broadcasters, which was worth tens of millions of dollars per year to the code.
The club grew its membership to more than 26,000 last year, underpinning a business which had $43 million in total turnover.
The Giants have lent on the corporate expertise of its directors, entering into a number of sponsorship agreements involving cash and contra.
The documents lodged with ASIC reveal a $1 million-plus deal with Virgin Australia, of which $516,590 involved contra, was signed off last year. Giants chairman Tony Shepherd, who also chairs the SCG Trust, is a member of the Virgin Australia board.
The Giants held a $72,000 contra deal with Mashera as well as a $15,000 cash and $15,000 contra deal with PricewaterhouseCoopers, of which former board member Joseph Carrozzi is a managing partner.
Carrozzi quit his Giants directorship in November when he was elevated to the Football Federation of Australia board.
The Giants won support from Hawthorn president Jeff Kennett, who insisted the AFL must keep the franchise viable.
"This is part of the costs associated for not onlyRead More – Source