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Sea Eagles circle Sa

Discussion in 'Sea Eagles' started by ManlyBacker, Oct 20, 2009.

By ManlyBacker on Oct 20, 2009 at 8:03 PM
  1. ManlyBacker

    ManlyBacker Winging it Staff Member

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    The following is a letter from Bob Reilly, Chairman of the Manly-Warringah Rugby League Club Ltd, to members providing an update on the Club's refurbishment plans, trading position and on-going financial support and push for equity in the Sea Eagles (private entity holding the NRL license).




    At the General Meetings of the League Club held in March and May of this year I promised to keep members informed of the progress of the refurbishment of the Club's premises. Unfortunately, progress has been slow.

    Following recent questions from several members I am writing to you to provide a summary of where we are at with the refurbishments. I will also take this opportunity to update you on the Club's recent trading performance, and important decisions of the Board on the League Club's support of the Sea Eagles.

    Refurbishment update

    As approved by the members at our May General Meeting, Penn Sport completed the purchase of the Club's main premises at 563 Pittwater Road on 26 May 2009. Since then the Club has vacated the first floor and is now operating solely from the ground floor and the mezzanine level (the Lyons Den). Prior to the sale, the League Club controlled the entire building but the change to multiple tenants has attracted Local Government rules which have impacted on how Penn Sport can utilise the first floor.

    This restriction was not anticipated and Penn Sport are endeavouring to work through the building rules and to give the League Club the go ahead for the refurbishment as soon as possible. We are doing everything we can to assist Penn Sport in finalising this.

    The League Club has engaged the Reed Group for the refurbishment and draft plans have been prepared and a preliminary meeting held with Warringah Council. The plans are exciting but until Penn Sport confirm how they intend to use and gain entry to the first floor these plans cannot be finalised nor a Council Development Application prepared. To date, we are at least a month behind schedule but ready to progress quickly once the building owner confirms its intentions.

    In summary: we’re ready to get moving on an exciting refurbishment. There have been some unanticipated delays, and we’re now awaiting Penn Sport’s decision on the first floor. As soon as that’s done, we’ll get the next step underway.

    Trading Performance

    I am pleased to report that September 2009 was the League Club's 14th consecutive profitable trading month. Considering the losses incurred by the Club in the twelve months to July 2008 and the problems within the Australian economy throughout the past year this is an excellent result. Your support throughout this time has been greatly appreciated.

    Support for the Sea Eagles

    As you may be aware the Sea Eagles were privatised early in the 2004 season. The then League Club Chairman, Ken Arthurson committed $1 million a season to the Sea Eagles and the Junior League for 2003, 2004 and 2005 and this committment was more than met each year.

    In late 2005 the Sea Eagles were again struggling financially and a second private party bought into the Sea Eagles. To encourage the new partner the League Club Chairman at this time, Paul Cummings extended the $1 million committment for a further 3 years, 2006, 2007 and 2008. Due to the League Club's poor trading in 2007 an agreement was reached with the Sea Eagles whereby the $3 million committment was met over 4 years and the final payment will be made in October 2009.

    During the past 16 years, the League Club has proudly given direct financial support to the Sea Eagles of almost $30 million and another $1.8 million to the Junior League.

    This was despite profits of approximately $25 million for the same period.

    Since the Sea Eagles were privatised in 2004 (including the final payment planned for October 2009), the League Club's financial support to the Sea Eagles will be approximately $4.6 million, plus $560,000 to the Junior League.

    Throughout 2008 and 2009 the League Club has shed many staff, sold its only real asset and now only has premises for a guaranteed maximum of 7 years.

    Despite such a financial contribution to the Sea Eagles, the League Club does not own a share in the privately owned Sea Eagles. This is not a fair reward to the 20,000 League Club members for 15 years and almost $30 million of unaffordable support to the Sea Eagles.

    The League Club is refurbishing our premises to help build a brighter future, and in doing this, to be able to afford increased funds to the Sea Eagles in future years. 2010 is a renovation year for the League Club and will be a challenge. At the September 2009 meeting of the Directors of the League Club it was decided that in 2010 the refurbishment of the League Club would be the priority and support of the Sea Eagles would not compromise this project. A base grant of $200,000 was set for the 2010 season.

    But beyond 2010, when we expect a refurbished League Club to be in a better financial position, we believe a new approach is needed to give greater value to the 20,000 League Club members.

    The Board therefore decided on 3 key principles for the future:

    1. A base grant of no less than $200,000 should be confirmed for every year
    2. Should profitability allow it, the League Club will provide more to the Sea Eagles – up to 50% of total League Club profit (as
        opposed to over 100% over the last 16 years!)
    3. Any funds over and above the base grant of $200,000 per year should be in exchange for shares in the Sea Eagles

    Given the League Club's level of support of the Sea Eagles since it first entered the competition in 1947 it is only fitting that the League Club join the Delmege and Penn families and the Manly-Warringah Rugby League Football Club as a shareholder in the Manly Warringah Sea Eagles. We want to work closely alongside the 2 private owners of the Sea Eagles, and contribute financially to the ongoing growth of the team. We look forward to the opportunity to do that as shareholders.

    In summary: The League Club will continue to be an important financial contributor to the Sea Eagles; over the past 16 years, we’ve contributed almost $30 million. Our future financial support is guaranteed, but we want to take our rightful place as part-owners of the Sea Eagles, to fully represent the interests of our 20,000 members.

    The current board of the League Club is passionate about the Sea Eagles but it is also determined to ensure a bright future for the League Club, and to get value for our 20,000 members. I hope you have found this update informative. I look forward to very soon being able to bring you good news on the progress of our refurbishment.

    Yours sincerely


    Bob Reilly, Chairman,
    Manly-Warringah Rugby League Club Ltd

     
     

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Discussion in 'Sea Eagles' started by ManlyBacker, Oct 20, 2009.

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