CATS’ $10M DEBT SHOCK
Cook flags cost of COVID-19 as Cats unveil raft of incentives to keep members paid up.
GEELONG is bracing to be more than $10 million in debt as the financial pinch from the coronavirus takes its toll on the AFL landscape.
The Cats were on the verge of being debt-free for the first time in 50 years before the pandemic. An email sent to members last night outlined the club’s financial plight.
“There is no doubt the club will survive; however, we could be faced with debts of over $10 million which would compromise our ability to win premierships, grow our club and have community impact,” it stated.
Geelong will go without $1 million per home game this year with crowds unlikely to be able to attend games.
“The reality is we could be more than $10 million (in debt),” Geelong chief executive Brian Cook said.
“Basically we generate $1 million profit per home game, whether it’s Melbourne or Geelong, and for each game without a crowd, there’s the potential not to have that revenue. That could lead to significant debt.”
Food and beverage sales also came in at $10.4 million last year, which the club will go without in 2020.
Cook said most of Geelong’s debt was linked to the stadium redevelopment.
He said the club could handle the debt.
“It’s not a bad time to have debt if you’re going to have some … we tried so hard to eliminate it and we were getting to the stage where we just about had and had plans to in three months time (to) say, ‘We had no debt for the first time in 50 years’,” he said.
“When I arrived in Geelong in 1999, we had around $7 million debt and that was at 17 per cent interest per annum.
“Having a debt of $7 million (then), that’s like having a debt of $20 million now.
“We’ve been through this before. It’s not a good place to be but I’d rather be in this place probably now, believe it or not, given ’99’s figures.”
Cook said the impacts would be felt for some time. “The other thing is, we don’t know how long we will be affected by the virus economically,” he said.
“How long will it take us to actually come back to where we were late last year with members and all sorts of things? Can we assume that our members who are going through some sort of hardship now will come back next year?
“Will people still be affected as much as they are now?
“We just don’t know and we’re guessing.”